Basis of preparation of financial statements
 
 The financial statements are prepared on accrual basis under the
 historical cost convention, modified to include revaluation of certain
 assets, in accordance with applicable Accounting Standards (AS)
 specified in the Compa- nies (Accounting Standards) Rules, 2006 and
 presentational requirements of the Companies Act, 1956.
 
 Use of estimates
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles in India (GAAP) requires management to
 make estimates and assumptions that affect the reported amounts of
 assets and liabilities and the disclosure of contingent liabilities on
 the date of the financial statements and the results of operations
 during the year. Differences between actual results and estimates are
 recognised in the year in which the results are known or materialised.
 Examples of such estimates are estimated useful life of assets,
 provision for doubtful debts, etc. Actual results could differ from
 those estimates. Any revision to accounting estimates is recognised
 prospectively in current and future periods.
 
 Fixed assets / depreciation
 
 Fixed assets are stated at cost or at revalued amounts less accumulated
 depreciation. Cost of fixed assets includes all incidental expenses and
 interest costs on borrowings, attributable to the acquistion of
 qualifying assets, upto the date of commissioning of such assets.
 
 Depreciation for the year is computed on the straight line method, as
 per the rates derived from useful lives of fixed assets as estimated by
 the management, or as prescribed in Schedule XIV to the Companies Act,
 1956, whichever is higher. Accordingly, plant and machinery under
 operating lease are being depreciated over six years.  Additional
 charge of depreciation on amount added on revaluation is adjusted
 against revaluation reserve.
 
 Leasehold land is amortised over the period of the lease. Leasehold
 improvements are amortised over the remaining period of lease, or the
 derived useful lives of assets as prescribed in Schedule XIV to the
 Companies Act, 1956, whichever is shorter.
 
 Fixed assets individually costing upto Rs 5,000 are fully depreciated
 in the year of purchase.
 
 Fixed assets are reviewed for impairment on each Balance Sheet date, in
 accordance with AS 28 Impairment of Assets.
 
 Revenue recognition
 
 - Revenue from sale of products is recognised when the products are
 despatched to customers, which coincides with the transfer of risks and
 rewards.
 
 - Sales are stated inclusive of excise duty and net of rebates, trade
 discounts and sales tax/VAT
 
 - Dividend or other income from mutual fund investments is recognised
 on declaration of dividend or on redemption, as the case may be.
 
 Investments
 
 - Long term investments are stated at cost less amount written off,
 where there is a diminution in value, other than temporary.
 
 - Current investments are stated at lower of cost and fair value.
 
 Current assets
 
 (a) Inventories
 
 - Stores and spare parts are valued at lower of cost and net realisable
 value, computed on a weighted average basis.
 
 - Raw materials, packing materials and work-in-process are carried at
 cost, computed on a weighted average basis, after providing for
 obsolescence. In case there is a decline in replacement cost of such
 materials and the net realisable value of finished products in which
 they will be used is expected to be below cost, the value of such
 materials and work in process is appropriately written down.
 
 - Each item of finished products is valued at lower of cost (computed
 on weighted average basis) and net realisable value. Cost includes an
 appropriate portion of manufacturing and other overheads, where
 applicable. Excise duty on finished products is included in the value
 of finished products inventory.
 
 (b) All other items of current assets are stated at cost after adequate
 provisions for any diminution in the carrying value.
 
 Foreign currency transactions
 
 - Foreign currency transactions are accounted for at the exchange rate
 prevailing on the date of the transaction.  All monetary foreign
 currency assets and liabilities are converted at the exchange rates
 prevailing at the date of the balance sheet. All exchange differences
 are dealt with in the profit and loss account.
 
 - In case of forward exchange contracts, covered by Accounting Standard
 11, the premium is amortised over the period of the contract. Any
 profit or loss arising on the cancellation or renewal of a forward
 exchange contract is recognised as income or expense for the year.
 
 - Exchange difference is calculated as the difference between the
 foreign currency amount of the contract, translated at the exchange
 rate at the reporting date, or the settlement date where the
 transaction is settled during the reporting period, and the
 corresponding foreign currency amount translated at the later of the
 date of inception of the forward exchange contract and the last
 reporting date. Such exchange differences are recognised in the profit
 and loss account in the reporting period in which the exchange rates
 change.
 
 Lease Transactions
 
 - Operating Lease
 
 The assets given under operating lease are shown in the balance sheet
 under fixed assets and depreciated on a basis consistent with the
 depreciation policy of the Company. The net lease income is recognised
 in the profit and loss account on a straight line basis over the period
 during which the benefit is derived from the leased assets.
 
 Employee benefits
 
 a) Short term employee benefits
 
 All employee benefits payable /available within twelve months of
 rendering the service are classsified as short- term employee benefits.
 Benefits such as salaries, wages and bonus etc., are recognised in the
 profit and loss account in the period in which the employee renders the
 related service.
 
 b) Post-employment benefits Defined contribution plans
 
 Defined contribution plans are provident fund scheme and part of the
 pension fund scheme for eligible employees. The Companys contribution
 to defined contribution plans are recognised in the profit and loss
 account in the financial year to which they relate.
 
 The Company makes specified monthly contribution towards employee
 provident fund and pension fund to respective trusts administered by
 the Company. The minimum interest payable by the provident fund trust
 to the beneficiaries every year is notified by the Government. The
 Company has an obligation to make good the shortfall, if any, between
 the return on investments of the trust and the notified interest rate.
 
 Defined benefit plans
 
 Liability for funded post retirement gratuity and pension and unfunded
 post retirement medical benefit is accrued on the basis of actuarial
 valuation as at the date of the balance sheet. The obligation is
 measured as the present value of the estimated future cash flows.
 Actuarial gains and losses are recognised immediately in the profit and
 loss account. In case of funded schemes, differential between fair
 value of plan assets of trusts and the present value of obligation as
 per acturial valuation is recognised as an asset or liability based on
 the assessment of related cash flows.
 
 c) Other long term employee benefits
 
 Entitlements to annual leave and sick leave are recognised when they
 accrue to employees. All leave entitlements can only be encashed at the
 time of retirement/ termination of employment or may be availed during
 the term of employment, subject to a restriction on the maximum number
 of accumulation of leave entitlement days. The Company determines the
 liability for such accumulated leave entitlements on the basis of
 actuarial valuation as at the year end.
 
 Research and development
 
 Revenue expenditure on research and development including contribution
 to research associations is charged to profit and loss account. Capital
 expenditure on tangible assets for research and development is shown as
 additions to fixed assets.
 
 Taxation
 
 Income tax expense comprises current tax and deferred tax charge or
 credit. Current tax provision is made based on the tax liability
 computed after considering tax allowances and exemptions under the
 Income Tax Act, 1961.
 
 The deferred tax charge or credit and the corresponding deferred tax
 liability and assets are recognised using the tax rates that have been
 enacted or substantively enacted on the balance sheet date.
 
 Deferred tax assets arising from unabsorbed depreciation or carry
 forward losses are recognised only if there is virtual certainty of
 realisation of such amounts. Other deferred tax assets are recognised
 only to the extent there is reasonable certainty of realisation in
 future. Deferred tax assets are reviewed at each balance sheet date to
 reassess their realisability.
 
 Provisions and contingent liabilities
 
 The Company recognises a provision when there is a present obligation
 as a result of a past event and it is more likely than not that there
 will be an outflow of resources embodying economic benefits to settle
 such obligations and the amount of such obligation can be reliably
 estimated. Provisions are not discounted to their present value and are
 determined based on the managements estimation of the outflow required
 to settle the obligation at the balance sheet date. These are reviewed
 at each balance sheet date and adjusted to refect current management
 estimates.
 
 Contingent liabilites are disclosed in respect of possible obligations
 that have arisen from past events and the existence of which will be
 confirmed only by the occurence or non-occurrence of future events not
 wholly within the control of the Company.
 
 When there is an obligation in respect of which the likelihood of
 outflow of resources is remote, no provision or disclosure is made.