a.  BASIS OF ACCOUNTING:
 
 Financial statements are prepared under the historical cost convention
 and as a going concern, on accrual basis and in accordance with the
 normally accepted accounting standards.
 
 b.  FIXED ASSETS:
 
 Fixed Assets are stated at cost less accumulated depreciation. Cost is
 inclusive of freight, duties, taxes and any directly attributable cost
 of bringing the assets to their working condition for intended use.
 
 c.  DEPRECIATION:
 
 Depreciation is provided on Straight Line Method at the rates specified
 in Schedule XIV of the Companies Act, 1956 on pro-rata basis. However,
 for Assets given on Lease, Depreciation has been charged equally over
 the lease period.
 
 d.  INVENTORIES:
 
 As the Operations in Distillery Division at Goa have been suspended for
 the past eleven years, the stocks maintained were unusable for
 commercial purpose and hence have been fully written off.
 
 e.  INVESTMENTS:
 
 Investments are long term and stated at cost. Provision has been
 created in the accounts for permanent diminution in the value of
 Investments.
 
 f.  FOREIGN CURRENCYTRANSACTIONS:
 
 All foreign currency transactions are accounted for at the rates
 prevailing on the dates of the transaction.  Foreign currency
 liabilities are converted at the year end rates as applicable.
 
 The exchange difference on settlement / conversion is adjusted to a)
 cost of fixed assets, if the foreign currency liability relates to
 fixed assets and b) Profit and Loss account in all other cases.
 
 g.  REVENUE RECOGNITION:
 
 Revenue is recognised at agreed rates on transfer of property in goods.
 With respect to operating lease, lease rentals are accounted as and
 when due.
 
 h.  RETIREMENT BENEFITS:
 
 Contribution to Provident Fund, Family Pension Fund and approved LIC
 Group Gratuity Scheme are charged in the year in which they are
 incurred. Provisions for Leave Encashment have been made as per the
 eligibility of the employees as at the end of the year on actual basis.
 
 i.  TAXES ON INCOME:
 
 Tax on Income for the current period is determined on the basis of
 taxable income and tax credits computed in accordance with the
 provisions of I ncome Tax Act 1961.
 
 Deferred Tax is recognised on timing differences between the accounting
 income and the taxable income for the year and quantified using the tax
 rates and laws that are enacted or substantially enacted as on the
 Balance Sheet date, where there is a carry forward loss or
 depreciation. Deferred tax asset is recognised in books of accounts
 only when there is reasonable certainty with respect to the future
 profits.
 
 j.  BORROWING COSTS:
 
 Borrowing costs that are attributable to construction of qualifying
 assets are capitalised as part of cost of such assets till such time
 the asset is ready for its intended use. A qualifying asset is an asset
 that necessarily requires a substantial period of time to get ready for
 its intended use. All other borrowing costs are recognised as an
 expense in the period in which they are incurred.
 
 a.  Alpic Finance Ltd: The Company has accepted the OTS for the said
 amount, which was payable by 30.09.2002. However, the Company has not
 complied with the terms of OTS.
 
 b.  East India Hotels Ltd: This amount is payable on account of
 termination of technical services agreement
 
 with the party, and the said amount is payable by the Company by
 31.12.2002 vide agreement dated 04.02.2002. The Company has made
 default in repaying the amount along with interest.