Tata Steel

1.  We have audited the attached Balance Sheet of TATA STEEL LIMITED,
 as at 31st March, 2009, the Profit and Loss Account for the year ended
 on that date and the Cash Flow Statement for the year ended on that
 date both annexed thereto in which are incorporated the Returns from
 the Singapore Branch audited by another auditor. These financial
 statements are the responsibility of the Companys management. Our
 responsibility is to express an opinion on these financial statements
 based on our audit.
 
 2.  We conducted our audit in accordance with auditing standards
 generally accepted in India. Those Standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatement. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in the financial statements. An audit also includes
 assessing the accounting principles used and significant estimates made
 by management, as well as evaluating the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 3.  As required by the Companies (Auditors Report) Order, 2003 issued
 by the Central Government of India in terms of sub-section (4A) of
 Section 227 of the Companies Act, 1956, we enclose in the Annexure a
 statement on the matters specified in paragraphs 4 and 5 of the said
 Order to the extent applicable.
 
 4.  Further to our comments in the Annexure referred to in paragraph
 (3) above, we report that:
 
 (a) we have obtained all the information and explanations, which to the
 best of our knowledge and belief were necessary for the purposes of our
 audit;
 
 (b) in our opinion, proper books of account as required by law have
 been kept by the Company so far as appears from our examination of the
 books and proper returns adequate for the purposes of our audit have
 been received from the Singapore Branch not visited by us. The Branch
 Auditors Report has been forwarded to us and appropriately dealt with;
 
 (c) the Balance Sheet, the Profit and Loss Account and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account and with the audited returns from the branch;
 
 (d) in our opinion, the Balance Sheet, the Profit and Loss Account and
 Cash Flow Statement dealt with by this report comply with the
 Accounting Standards referred to in sub-section (3C) of Section 211 of
 the Companies Act, 1956;
 
 (e) in our opinion, and to the best of our information and according to
 the explanations given to us, the said accounts give the information
 required by the Companies Act, 1956, in the manner so required and give
 a true and fair view in conformity with the accounting principles
 generally accepted in India :
 
 (i) in the case of the Balance Sheet, of the state of affairs of the
 Company as at 31 st March, 2009;
 
 (ii) in the case of the Profit and Loss Account, of the profit of the
 Company for the year ended on that date; and
 
 (iii) in the case of the Cash Flow Statement, of the cash flows for the
 year ended on that date.
 
 5.  On the basis of written representations received from the
 directors, as on 31st March, 2009 and taken on record by the Board of
 Directors, we report that none of the directors is disqualified as on
 31st March, 2009 from being appointed as a director in terms of clause
 (g) of sub-section (1) of Section 274 of the Companies Act, 1956.
 
 Annexure to the Auditors Report
 
 [Referred to in paragraph (3) of our report of even date]
 
 The nature of the Companys business/activities during the year is such
 that clauses (xii), (xiii) and (xiv) of paragraph 4 of the Companies
 (Auditors Report) Order, 2003 are not applicable to the Company
 
 (i) In respect of its fixed assets :
 
 (a) The Company has maintained proper records showing full particulars
 including quantitative details and situation of fixed assets.
 
 (b) Some of the fixed assets have been physically verified during the
 year by the Management in accordance with a programme of verification,
 which in our opinion provides for physical verification of all the
 fixed assets at reasonable intervals. According to the information and
 explanations given to us no material discrepancies were noticed on such
 verification.
 
 (c) The fixed assets disposed off during the year, in our opinion, do
 not constitute substantial part of the fixed assets of the Company and
 such disposal has, in our opinion, not affected the going concern
 status of the Company.
 
 (ii) In respect of its inventories :
 
 (a) As explained to us, the inventories of finished and semi-finished
 goods and raw materials at Works, Mines and Collieries were physically
 verified during the year by the Management. In respect of stores and
 spare parts and stocks at stockyards and with Consignment/Conversion
 Agents, the Company has a programme of verification of stocks over a
 three-year period. In our opinion, having regard to the nature and
 location of stocks, the frequency of verification is reasonable. In
 case of materials lying with third parties, certificates confirming
 stocks have been received in respect of a substantial portion of the
 stocks held.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verification of inventories
 followed by the management were reasonable and adequate in relation to
 the size of the Company and the nature of its business.
 
 (c) In our opinion and according to the information and explanations
 given to us, the Company has maintained proper records of its
 inventories and no material discrepancies were noticed on physical
 verification.
 
 (iii) According to the information and explanations given to us, the
 Company has not granted or taken any secured or unsecured loan to or
 from companies, firms or other parties covered in the Register
 maintained under Section 301 of the Companies Act, 1956. Consequently,
 clauses (iii)(a) to (iii)(g) of paragraph 4 of the order are not
 applicable.
 
 (iv) In our opinion and according to the information and explanations
 given to us, having regard to the explanation that some of the items
 purchased are of special nature and suitable alternative sources do not
 exist for obtaining comparable quotations, there is adequate internal
 control system commensurate with the size of the Company and the nature
 of its business for the purchase of inventories and fixed assets and
 for the sale of goods and services and we have not observed any
 continuing failure to correct major weaknesses in such internal control
 system.
 
 (v) According to the information and explanations given to us, the
 Company has not entered into any contract or arrangement with other
 parties, which needs to be entered in the register maintained under
 Section 301 of the Companies Act, 1956.  Consequently, clause (v)(a)
 and (v)(b) of paragraph 4 of the order are not applicable.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the Company has complied with the provisions of Sections
 58A, 58AA or any other relevant provisions of the Companies Act, 1956
 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to
 the deposits accepted from the public.
 
 (vii) In our opinion, the Company has an adequate internal audit system
 commensurate with the size and nature of its business.
 
 (viii) We have broadly reviewed the books of account and records
 maintained by the Company relating to the manufacture of bearings,
 steel tubes and pipes, steel, chrome ore and alloys and electricity,
 pursuant to the Rules made by the Central Government for the
 maintenance of cost records under Section 209(1 )(d) of the Companies
 Act, 1956 and are of the opinion that prima facie, the prescribed
 accounts and records have been made and maintained. We have, however,
 not made a detailed examination of the records with a view to
 determining whether they are accurate or complete. To the best of our
 knowledge and according to the information given to us, the Central
 Government has not prescribed the maintenance of cost records for any
 other product of the Company.
 
 (ix) In respect of Statutory Dues :
 
 (a) According to the information and explanations given to us, the
 Company has been generally regular in depositing undisputed statutory
 dues including Provident Fund, Investor Education and Protection Fund,
 Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise
 Duty, Cess and other material statutory dues with the appropriate
 authorities during the year. We are informed that the Company intends
 to obtain exemption from the operation of the Employees State
 Insurance Act at all locations and necessary steps have been taken by
 the Company. We are also informed that action taken by the authorities
 at some locations to bring the employees of the Company under the
 Employees State Insurance Scheme has been contested by the Company and
 accordingly full payment has not been made of the contributions
 demanded.
 
 (b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of Income Tax, Wealth Tax, Sales
 Tax, Custom Duty, Excise Duty, Cess and other material statutory dues,
 were in arrears, as at 31st March, 2009 for a period of more than six
 months from the date they became payable, except for collection of
 sales tax which we are informed are refundable to customers because
 they have been collected in excess or which have been collected pending
 receipt of the relevant certificates from the customers.
 
 (x) The Company does not have any accumulated losses and has not
 incurred cash loss during the financial year covered by our audit and
 the immediately preceding financial year.
 
 (xi) In our opinion and according to the information and explanations
 given to us, the Company has not defaulted in repayment of dues to
 financial institutions, banks or debenture holders.
 
 (xii) In our opinion and according to information and explanations
 given to us, the terms and conditions of the guarantees given by the
 Company for loans taken by others from banks or financial institutions,
 are not prima facie prejudicial to the interest of the Company.
 
 (xiii) To the best of our knowledge and belief and according to the
 information and explanations given to us, in our opinion, term loans
 availed by the Company were, prima facie, applied by the Company during
 the year for the purposes for which the loans were obtained, other than
 temporary deployment pending application.
 
 (xiv) According to the information and explanations given to us and on
 an overall examination of the Balance Sheet of the Company, funds
 raised on short-term basis have, prima facie, not been used during the
 year for long term investment.
 
 (xv) The Company has not made any preferential allotment of shares to
 parties and companies covered in the register maintained under Section
 301 of the Companies Act, 1956.
 
 (xvi) According to the information and explanations given to us and the
 records examined by us, securities/charges have been created in respect
 of debentures issued.
 
 (xvii) During the period covered by our audit report, the Company has
 not raised any money by public issues.
 
 (xviii)To the best of our knowledge and belief and according to the
 information and explanations given to us, no significant fraud on or by
 the Company was noticed or reported during the year.
 
 
 
                                      For DELOITTE HASKINS & SELLS 
                                             Chartered Accountants,
                                                      P. R. RAMESH
                                                           Partner
                                            Membership No. : 70928
 
 Mumbai, 
 25th June, 2009