Hi Tejas
Sorry for the late reply. I haven't yet applied and my application is in the middle of 2014 but I asked early on as it takes a few months if you have to do the exam.
I have also inquired with the Home Office directly and they have replied suggesting the below quote. Note, this is not to be construed as an answer to your query but just an additional piece of information. You may want to check with the immigration team at the home office by calling them yourself. However, hope this information is useful to you and everyone else reading this post.
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Current Koll requirements are given at the following link-
http://www.ukba.homeoffice.gov.uk/sitec ... hip/kol-uk
From this link the following information is provided concerning degrees taught in English-
{Those who have obtained a degree taught in English will not be required to show a formal speaking and listening qualification. Those with an academic qualification (not a professional or vocational qualification) who provide appropriate evidence that the qualification was taught or researched in English are considered automatically to meet the English language component of the KoLL requirement and will not be required to show a formal speaking and listening qualification. The qualification must be deemed by UK NARIC to meet the recognised standard of a Bachelor’s or Master’s degree or PhD in the UK. However, they will still be required to pass the Life in the UK test to demonstrate their knowledge of life in the UK.}
Currently there is no points based calculator for applications of naturalisation and the guidance requests appropriate evidence that the qualification was taught in English and a statement of equivalence from UK NARIC to prove the standard.
You may wish to use the points based calculator in lieu of a statement of equivalence for proving the qualification is deemed by UK NARIC to meet the required standard for the language requirement of nationality applications mentioned within this guidance. However, evidence to support your application will then be considered at the discretion of a caseworker, if they are not satisfied they may request further evidence. This could delay your application.
Please also note that as the onus is upon the individual to ensure that he/she satisfies the requirements set out in the guidance material that accompanies each and every application form, the Nationality Group is not able to give, indicate or advise upon the outcome of any such application prior to it being correctly submitted and being given full and careful consideration. Therefore, you are advised to read through the guide prior to submitting a future application.