Williamson Tea Assam

1. We have audited the attached Balance Sheet of Wllliamson Tea Assam
 Limited, as at 31st March 2005, and the related Profit and Loss
 Account and Cash Flow Statement for the year ended on that date and
 annexed thereto, which we have signed under reference to this report.
 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 the 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 as
 amended by the Companies (Auditors Report) (Amendment) Order, 2004,
 issued by the Central Government of India in terms of sub-section (4A)
 of Section 227 of The Companies Act, 1956 of India (The Act) and on
 the basis of such checks of the books and records of the company as we
 considered appropriate and according to the information and
 explanations given to us, we give in the Annexure a statement on the
 matters specified in paragraphs 4 and 5 of the said Order.
 
 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
 those books;
 
 (c) The Balance Sheet, Profit and Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the books of account;
 
 (d) In our opinion, the Balance Sheet, 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 Act;
 
 (e) On the basis of written representations received from the
 directors, as on 31st March 2005 and taken on record by the Board of
 Directors, none of the directors is disqualified as on 31st March 2005
 from being appointed as a director in terms of clause (g) of
 sub-section (1) of Section 274 of `The Act;
 
 (f) In our opinion and to the best of our information and according to
 the explanations given to us, the Balance Sheet, Profit & Loss Account
 and Cash Flow Statement together with the notes thereon and attached
 thereto give the information required by the Act in the manner so
 required and give a true and fair view in conformity with the
 accounting principles generally accepted in India:
 
 (i) in case of the Balance Sheet, of the state of affairs of the
 company as at 31st March 2005;
 
 (ii) in case of the Profit and Loss Account, of the profit for the year
 ended on that date; and
 
 (iii) in case of the Cash Flow Statement, of the cash flows for the
 year ended on that date.
 
                                                       PRABAL K R.SARKAR
                                                                 Partner
                                                Membership Number: 52340
                                                    For and on behalf of
                                                        LOVELOCK & LEWES
 Kolkata, 27th May 2005                            Chartered Accountants
 
 ANNEXURE TO AUDITORS REPORT
 
 (Referred to in paragraph 3 of the Auditors Report of even date to the
 members of Williamson Tea Assam Limited on the financial statement* for
 the year ended 31st March 2005)
 
 1. (a) The company is maintaining proper records showing full
 particulars including quantitative details and situation of fixed
 assets.
 
 (b) The fixed assets of the company have been physically verified by
 the management during the year and no material discrepancies between
 the book records and the physical inventory have been noticed. In our
 opinion, the frequency of verification is reasonable.
 
 (c) In our opinion and according to the information and explanations
 given to us, a substantial part of fixed assets has not been disposed
 of by the company during the year.
 
 2. (a) The inventories (excluding those with third parties and
 in-transit) has been physically verified by the management during the
 year. In respect of inventory lying with third parties and in-transit,
 these have substantially been confirmed by the third parties and/or
 were verified with reference to subsequent sales or receipts. In our
 opinion, the frequency of verification is reasonable.
 
 (b) In our opinion and according to the information and explanations
 provided to us, the procedures of physical verification of inventory
 followed by the management are reasonable and adequate in relation to
 the size of the company and the nature of its business.
 
 (c) On the basis of our examination of the inventory records, in our
 opinion, the company is maintaining proper records of inventory. The
 discrepancies noticed on physical verification of inventory as compared
 to book records, which were not material, have been properly dealt with
 in the books of account.
 
 3. (a) The company has not granted any loans, secured or unsecured, to
 companies, firms or other parties covered under the register maintained
 under Section 301 of `The Act.
 
 (b) The Company has not taken any loans, secured or unsecured, from
 companies, firms or other parties covered in the register maintained
 under Section 301 of `The Act.
 
 4. In our opinion and according to the information and explanations
 given to us, there are adequate internal control procedures
 commensurate with the size of the company and the nature of its
 business for the purchase of inventory, fixed assets and for the sale
 of goods. Further, on the basis of our examination of the books and
 records of the company, and according to the information and
 explanations given to us, we have neither come across nor have been
 informed of any continuing failure to correct major weaknesses in the
 aforesaid internal control procedures.
 
 5. (a) In our opinion and according to the information and explanations
 given to us, the particulars of contracts or arrangements referred to
 in Section 301 of The Act have been entered in the Register required
 to be maintained under that section.
 
 (b) In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of such contracts or
 arrangements and exceeding the value of Rs. 5 lakhs in respect of any
 party during the year were of special nature for which competitive
 quotations were not available.
 
 6. In our opinion and according to the information and explanations
 given to us, the company has complied with the provisions of Sections
 58A and 58AA of `The Act and the Companies (Acceptance of Deposits)
 Rules, 1975 with regard to the deposits accepted from the public.
 According to the information and explanations given to us, no Order
 under the aforesaid Sections has been passed by the Company Law Board
 on the company.
 
 7. In our opinion, the company has an internal audit system
 commensurate with its size and nature of its business.
 
 8. We have broadly reviewed the books of account maintained by the
 company in respect of product where, pursuant to the Rules made by the
 Central Government of India, the maintenance of cost records has been
 prescribed under clause (d) of sub-section (1) of Section 209 of `The
 Act and are of the opinion that prima facie, the prescribed accounts
 and records have been made and maintained. We have not, however, made a
 detailed examination of the records with a view to determine whether
 they are accurate or complete.
 
 9. a) According to the information and explanations given to us and
 the records of the company examined by us, in our Opinion, the company
 is generally regular in depositing undisputed statutory dues including
 investor education and protection fund, provident fund, employees
 state insurance, income tax, sales tax, wealth tax, customs duty,
 excise duty, cess and other material statutory dues as applicable, with
 the appropriate authorities.
 
 b) According to the information and explanations given to us and the
 records of the company examined by us, the particulars of dues of
 income-tax, sales-tax, wealth tax, customs duty, excise duty and cess
 as at 31st March 2005 which have not been deposited on account of a
 dispute, are as follows-
 
 Name of the statute       Nature of Dues          Amount
                                              (Rs. lacs.)
 
 West Bengal Sales Tax Act West Bengal Sales Tax     1.16
 
 Central Sales Tax Act     Central Sales Tax        15.52
 
 Name of the statute       Forum where the dispute is pending
 
 West Bengal Sales Tax Act Appellate Tribunal, Kolkata
 
 Central Sales Tax Act     Commissioner of Taxes,
                           Guwahati, Assam
 
 10. The company has no accumulated losses as at 31st March 2005 and it
 has not incurred any cash losses in the financial year ended on that
 date or in the immediately preceding financial year.
 
 11. According to the records of the company examined by us and the
 information and explanations given to us, the company has not defaulted
 in repayment of dues to any financial institution or bank or debenture
 holders as at the balance sheet date.
 
 12. The company has not granted any loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 13. The provisions of any special statute applicable to chit
 fund/nidhi/mutual benefit fund/societies are not applicable to the
 company.
 
 14. In our opinion, the company is not a dealer or trader in shares,
 securities, debentures and other investments.
 
 15. In our opinion and according to the information and explanations
 given to us, the company has not given any guarantee for loans taken
 by others from banks or financial institutions during the year.
 
 16. In our opinion, and according to the information and explanations
 given to us, on an overall basis, the term loans have been applied for
 the purposes for which they were obtained.
 
 17. On the basis of an overall examination of the balance sheet of the
 company, in our opinion and according to the information and
 explanations given to us, there are no funds raised on a short-term
 basis which have been used for long-term investment.
 
 18. The company has not made any preferential allotment of shares to
 parties and companies covered in the register maintained under Section
 301 of `The Act during the year.
 
 19. The company has not issued any debentures and accordingly the
 question of creation of security or charge does not arise.
 
 20. The company has not raised any money by public issues during the
 year.
 
 21. During the course of our examination of the books and records of
 the company, carried out in accordance with the generally accepted
 auditing practices in India, and according to the information and
 explanations given to us, we have neither come across any instance of
 fraud on or by the company, noticed or reported during the year, nor
 have we been informed of such case by the management.
 
                                                        PRABAL KR.SARKAR
                                                                 Partner
                                                Membership Number: 52340
                                                    For and on behalf of
                                                        LOVELOCK & LEWES
 Kolkata, 27th May 2005                            Chartered Accountants