(i) Basis of accounting
 
 (a) The Company prepares its accounts under historical cost convention
 and on accrual basis except otherwise stated, in accordance with the
 normally accepted accounting principles.
 
 (b) Revenue from sale of goods is recognized on passage of title to the
 customers, which generally coincides with delivery. Revenue from
 services rendered is recognized on rendering of services to the
 customers.
 
 (c) Bonus including ex-gratia payable and leave salary payable to the
 employees, as per consistent practice, are accounted for on cash basis.
 
 (d) Dividend on Investments in shares and refunds of excise and other
 levies/taxes are accounted for on acceptance/actual receipt basis.
 
 (ii) Fixed Assets:
 
 Fixed Assets are stated at cost of acquisition net of cenvat and
 inclusive of freight, duties, and cost of finance during construction
 period and expenses related to acquisition, installation, erection and
 commissioning.
 
 (iii) Investments:
 
 Investments that are readily realizable and intended to be held for not
 more than a year are classified as current investments. All other
 investments are classified as long term investments. Investments are
 carried and valued at cost. Profit or loss if any on the same are
 accounted for upon their disposal/Sale.
 
 (iv) Depreciation:
 
 (a) Depreciation on fixed assets has been provided for on the
 straight-line method at the rates and in the manner prescribed, under
 schedule XIV of the Companies Act, 1956.
 
 (b) Depreciation on fixed assets added during the year is provided on
 Pro-rata with reference to the month of addition/deletion, except for
 assets costing Rs.5, 000/- or less on which 100% depreciation is
 provided.
 
 (c) Depreciation includes amount written off in respect of leasehold
 properties over the respective lease period.
 
 (v) Valuation of Inventories:
 
 Inventories are valued as under:
 
 Raw Materials            At lower of cost or net realizable value.
 
 Finished goods           At lower of cost (including Excise Duty) 
                             or net realizable value.
 
 Work-in-Progress         At lower of cost or net realizable value.
                          Cost includes direct materials, labour cost
                          and manufacturing overheads based on
                          normal operating capacity
 
 Stores & Spares          At lower of cost or net realizable value.
 
 Wastes & Others          At net realizable value.
 
 
 The cost of inventories comprises of all costs of purchase, Freight,
 Taxes & Duties costs of conversion and other cost directly attributable
 to the acquisition thereof. For arriving at the cost of inventories,
 the FIFO cost formula along with the retail method for measurement of
 cost has been adopted.
 
 (vi) Retirement Benefits and other Employee Benefits:
 
 a.  Companys contributions to Provident Fund and Employees State
 Insurance Fund are charged to the Profit & Loss Account of the year
 when the contributions to the respective funds are due.
 
 b.  Provision has been made for the liability on account of Gratuity
 payable to employees, which is unfunded .  plan of the company.
 
 (vii) Sales:
 
 Sales are inclusive of sales tax and excise duty and shown net of sales
 returns.
 
 (viii) Other Income:
 
 Interest income on Fixed Deposits is accounted for on accrual basis.
 Dividend and other interest income are accounted for as and when
 received.
 
 (ix) Excise Duty:
 
 Excise Duty is accounted for at the point of manufacture of goods and
 accordingly is considered for valuation of finished goods stock lying
 in the factory as on the Balance Sheet date.
 
 (x) Contingent Liabilities:
 
 Contingent Liabilities that are not provided for have been disclosed by
 way of Notes to the Accounts.
 
 (xi).  Income tax:
 
 Provision for Tax comprises of both current and deferred taxes.
 Deferred tax is accounted for by computing the tax effect of timing
 differences which arise during the year and reversal of timing
 differences of earlier years, subject to consideration of prudence.
 Deferred Tax is measured based on the tax rates and the tax laws
 enacted or substantively enacted on the Balance Sheet date.
 
 (xii) Borrowing costs :
 
 The borrowing costs other than relating to the acquisition /
 construction of assets are recognised as an expense in the financial
 accounts.