a.  Accounting Convention: The accompanying financial statements are
 prepared under the historical cost convention on the accrual basis of
 accounting in accordance with generally accepted accounting principles
 to reflect the financial position & results of operation. These
 financial statements have been prepared on a going concern basis, which
 assumes the realization of assets and satisfaction of liabilities in
 the normal course of business.
 
 For the year under consideration, the revised Schedule VI notified
 under the Companies Act, 1956 has become applicable to the Company for
 presentation of its financial statements. The revised Schedule VI has a
 significant impact on the presentation and disclosures made in the
 financial statements. The Company has also reclassified the previous
 year figures in accordance with the requirements applicable in the
 current year.
 
 All assets and liabilities have been classified as current or
 non-current as per the Company''s normal operating cycle and other
 criteria set out in the revised Schedule VI to the Companies Act, 1956.
 Based on the nature of products and the time between the acquisition of
 assets for processing and their realization in cash and cash
 equivalents, the company has ascertained its operating cycle as 12
 months for the purpose of current - non current classification of
 assets and liabilities.
 
 b.  Fixed Assets: Fixed Assets are stated at their original cost net of
 cenvat, comprising of purchase price and other attributable cost of
 bringing assets to working condition for their intended use less
 accumulated depreciation and impairment loss, if any.
 
 c.  Depreciation: Depreciation on Fixed Assets is provided on straight
 line method at the rates and in the manner as prescribed in Schedule
 XIV of the Companies Act, 1956 on prorata basis.
 
 d.  Impairment of Assets: The carrying amount of assets are reviewed at
 each balance sheet date to determine if there is any indication of
 impairment based on internal/external factors. An asset is treated as
 impaired when the carrying cost of the asset exceeds its recoverable
 value i.e. net selling price or value in use, whichever is higher. An
 impairment loss, if any, is charged to profit & loss account in the
 year in which an asset is identified as impaired.
 
 e.  Inventories:
 
 i.  Raw Materials, Stores & Spares, Finished Goods and Work-in-process
 are valued at cost or net realisable value, whichever is lower. Closing
 Stock of Finished goods is inclusive of Excise Duty.  Cost is
 determined using FIFO method.  
 
 ii.  Scrap is valued at estimated Realisable value.
 
 f.  Sales: Sales are net of Sales Tax.
 
 g.  Cenvat: Cenvat claimed on Capital Goods is reduced from the cost of
 Plant & Machinery. Cenvat claimed on purchase of raw material is
 reduced from the cost of such material.
 
 h.  Employee Benefits :
 
 Defined Contribution Plans : Provident Fund & E.S.I: Contribution to
 Provident Fund and E.S.I to appropriate authorities is made
 periodically and is charged to Profit & Loss statement on accrual
 basis.  Defined Benefit Plan: Gratuity is a defined benefit scheme and
 is accounted based on actuarial valuation at the balance sheet date,
 carried out once in three years by an independent actuary.  Short Term
 Employee Benefits: All employee benefits which are wholly due within
 twelve months of rendering the services are recognised in the period in
 which the employee rendered the related services.
 
 i.  Provisions, Contingent Liabilities and Contingent Assets : The
 Company creates a provision when there is a present obligation as a
 result of past events and it is probable that there will be outflow of
 resources and a reliable estimate of the obligation can be made of the
 amount of the obligation.  Contingent liabilities are not recognised
 but are disclosed in the notes to the financial statements. A
 disclosure for a contingent liability is made when there is a possible
 obligation or a present obligation that may, but probably will not,
 require an outflow of resources.
 
 Provisions are reviewed at each balance sheet date and adjusted to
 reflect the current best estimate. If it is no longer probable that the
 outflow of resources would be required to settle the obligation, the
 provision is reversed.  
 
 Contingent assets are neither recognised nor disclosed in the financial
 statements.