(a) Accounting Concept
 
 The company generally follows the mercantile system of accounting and
 recognises revenue on accrual basis, except sale of scrap and
 insignificant items/amounts, which are accounted for on cash basis. The
 accounts are prepared and presented as a going concern concept in
 accordance with Generally Accepted Accounting Principles (GAAP) in
 India under historical cost convention and comply in all material
 aspects with the Accounting Standards (AS) and the relevant provisions
 prescribed in the Companies Act, 1956. The accounting policies not
 referred to otherwise are consistent with generally accepted accounting
 principles.
 
 (b) Use of Estimates
 
 The preparation of financial statements requires estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities on the date of the financial statements and reported amount
 of revenues and expenses during the reporting period. Although these
 estimates are based on the management''s best knowledge of current
 events and actions, the actual outcome may be different from the
 estimates. Difference between actual results and estimates are
 recognised in the period in which the results are known or materialise.
 
 (c) Fixed Assets
 
 Fixed Assets (Tangible and Intangible) are stated at cost of
 acquisition inclusive of inward freight, duties, taxes and incidental
 expenses related to acquisition and installation. In respect of major
 projects involving construction, related pre-operative expenses,
 including finance cost on borrowed funds attributable to acquisition of
 fixed assets for the period upto the date of commencement of commercial
 production is capitalised. In case of revaluation, acquisition cost is
 replaced with revalued figures.
 
 (d) Impairment of Assets
 
 Loss / gain on impairment of assets is recognised in accounts after
 reviewing net selling price / value in use and net carrying amount of
 individual assets ( if independently generating cash flow) and cash
 generating units at each Balance Sheet date.
 
 (e) Classification of Assets and Liabilities as Current and Non-Current
 
 All assets and liabilities are classified as current or non-current as
 per the Company''s normal operating cycle and other criteria set out in
 Schedule VI to the Companies Act, 1956. Based on the nature of products
 and the time between acquisition of assets for processing and their
 realisation in cash and cash equivalents, 12 months has been considered
 by the company for the purpose of current - non-current classification
 of assets and liabilities.
 
 (f) Investments
 
 Investments are classified as current and non-current. Current
 investments are those investments which are readily realisable, and are
 intended to be held for not more than one year from the date of
 investment. All other investments are classified as long- term
 investments.
 
 Current investments are stated at lower of cost and fair value
 determined.
 
 Long term investments are stated at cost less permanent diminution in
 value of such investments.
 
 (g) Depreciation
 
 Depreciation on fixed assets is provided under straight line method at
 the rates and in the manner prescribed under the Companies Act,1956.
 Assets acquired / disposed off during the year are depreciated with
 reference to the month of addition / disposal.  Assets under
 construction / installation are not depreciated. Assets used during
 construction of the project are depreciated and such depreciation forms
 part of the pre-operative cost. Annual depreciation on written up value
 due to revaluation of assets is charged to revaluation reserve account
 proportionately to the extent of balance held in the account.
 
 (h) Retirement Benefits
 
 The company is not covered by Employee''s Provident Fund Act and there
 is no scheme of Provident fund in vogue. Liability for gratuity is
 provided on actual basis, computed on the tenure of the service of the
 eligible employees as at the end of the year, in terms of paragraph 52
 of Accounting Standard - 15 ( Revised) issued by The Institute of
 Chartered Accountants of India, in view of few numbers of employees
 eligible for gratuity at present.
 
 (i) Inventories
 
 Raw materials are valued at lower of yearly weighted average cost
 (including related acquisition cost) or market prices. Cost of
 interdivisional transfer of goods has been taken as per policy
 enumerated in paragraph (l) below. Stock of such material, and
 
 consequential finished goods at balance sheet date, are valued taking
 the said transfer price and any unrealised profit on such transaction
 is eliminated while valuing the stock.
 
 Rejects, Middling, Slurry are valued at estimated realisable value.
 Other finished goods are valued at lower of weighted average cost or
 market / estimated realisable value. Cost includes material cost,
 labour and appropriate systematic allocation of fixed and variable
 production overheads on actual basis, based on estimated production
 facilities used by different divisions.
 
 Stock in transit, spares and stores etc. are valued at actual cost of
 purchase including related expenses. Scrap, being not material in
 amount, is not accounted for.
 
 (j) Proposed Dividend
 
 Dividend as proposed by the directors is provided in the books of
 account, pending approval at the Annual General Meeting.
 
 (k) Foreign Exchange Transactions
 
 Foreign exchange transactions are accounted for at the exchange rates
 prevailing on the date of transaction. Monatory items denominated in
 foreign currency are restated at the exchange rate prevailing at the
 Balance sheet date. In case of transactions covered by forward
 contract, they are restated at that rate and premium, if any, is
 allocated over the tenure of credit.
 
 (l) Inter-Division transfer
 
 Inter-divisional transfer of goods as independent marketable products
 of separate divisions for captive consumption are assigned value at
 lower of cost of production (wherever feasible) and estimated net
 realizable value. This accounting treatment has no impact on the profit
 of the company. Such transactions are neither included in turnover nor
 in consumption of materials, except for valuation purposes.
 
 (m) Sales
 
 Sales are inclusive of all taxes, except VAT & CST, less returns. In
 respect of service tax the same is not included in turnover if
 collected over and above the agreed charges.
 
 (n) Purchases
 
 Purchases are accounted for net of MODVAT / CENVAT/VAT/ Set off of
 taxes as applicable.
 
 (o) Borrowing Costs
 
 Borrowing costs that are attributable to the acquisition, construction
 or production of a qualifying asset are capitalised. Other borrowing
 costs are expensed out.
 
 (p) MODVAT / CENVAT/VAT/Set off of taxes
 
 Any set off / credit of taxes is adjusted against purchase cost of that
 item / goods if relates to current year. Adjustment of prior year is
 accounted for in profit & loss account separately.
 
 (q) Contingent Liabilities & Commitments
 
 Contingent liabilities and commitments are not provided for and are
 disclosed in notes attached to the accounts.
 
 (r) Taxes on Income
 
 Current income tax is determined in accordance with the provisions of
 the Income Tax Act, 1961, as the amount of tax payable to the taxation
 authorities in respect of taxable income for the year.
 
 Deferred tax is accounted for under the liability method, subject to
 the consideration of prudence for deferred tax assets, at the current
 rate of tax, on timing differences being the difference between taxable
 income and accounting income that originate in one period and are
 capable of reversal in one or more subsequent periods.
 
 Deferred tax assets and liabilities are offset if they are governed by
 same taxing laws.