1.  Fixed Assets:
 
 Capitalization and Depreciation:
 
 i) The values of Fixed Assets are at cost.  Expenditure on Land
 Development is capitalised. Cost of leasehold land is amortized over
 the period of lease on pro-rata basis.
 
 ii) Financing cost relating to borrowed funds or deferred credits is
 capitalised to the extent such costs are attributable to the period up
 to the completion of construction/acquisition of fixed assets for new
 projects or substantial expansion.
 
 iii) Expenditure on administration and general overhead attributable to
 construction or acquisition of fixed assets are not capitalised, as
 such expenses, besides being not significant, are not relatable to a
 specific asset.
 
 iv) Depreciation is charged on Straight Line Method basis at rates as
 per Schedule XIV of the Companies Act, 1956 (or such higher rates which
 in the opinion of the management is appropriate), calculated from the
 month following the month of capitalization.  Depreciation on additions
 (physical or value) or extensions to existing assets is provided so as
 to co-terminate with the life of the original asset or extended useful
 life based on technical assessment.
 
 v) Expenditure on reconditioning, rebuilding and major overhaul of
 machinery and equipment are capitalized only if technical assessment
 indicates increase in the future benefits from the existing assets
 beyond the previously assessed standards of performance. Ex: an
 increase in capacity, etc.
 
 2* Intangible Assets;
 
 a) Software
 
 The cost of software internally generated/ purchased for internal use
 which is not an integral part of the related hardware is recognized as
 an Intangible Asset and is amortised on straight line method based on
 technical assessment for a period not exceeding ten years. Software
 which is an integral part of related hardware is capitalized along with
 the hardware.
 
 b) Technical Know-how
 
 Expenditure on Technical Know-how is recognized as an Intangible Asset
 and amortised on straight line method based on technical assessment for
 a period not exceeding ten years.
 
 For SI. No. a & b above amortization commences when the asset is
 available for use.
 
 3.  Inventory Valuation:
 
 i) Raw materials, Components, Stores and Spare parts are valued at
 Weighted Average Cost or estimated net realizable value, whichever is
 lower.
 
 ii) Work-in-progress is valued at actuaf cost of materials, labour and
 production overheads based on normative capacity or adjusted/ estimated
 realisable value, whichever is lower.
 
 iii) Finished stock is valued at actual cost or estimated realisable
 value whichever is lower.
 
 iv) Estimated costs are considered wherever actual costs are not
 available.
 
 v) The cost is adjusted for decline in value by writing down the value
 based on specific identification. Further provision for obsolescence is
 made depending on movement.
 
 vi) Based on technical assessment, provision is made for
 revalidation/refurbishment of finished goods to reflect the current
 status thereof.
 
 vii) Scrap is valued at estimated realisable value.
 
 4.  Advances from customers:
 
 Advances from customers include advances/ progress payments received as
 per letters of intent / sale contracts and is net after adjustments for
 despatches with customers under respective contracts.
 
 5. Sales / Other Income:
 
 i) Sales for products viz., equipments, aggregates, attachments and
 ancillary/ dealership products is recognized when these are
 unconditionally appropriated to the valid sales contract or under
 dealership agreements.
 
 ii) In the case of contracts for supply of complex equipments/systems
 where the normal cycle time of completion and delivery period is more
 than 12 months and the value of the equipment/system is more than Rs.
 25 crores, revenue is recognized on the ''percentage completion method''.
 Percentage completion is based on the ratio of actual costs incurred on
 the contract up to the reporting date to the estimated total cost pf
 the product.
 
 Since the outcome of such a contract can be estimated reliably only on
 achieving certain progress, revenue is recognized up to 25% progress
 only to the extent of costs, thereafter revenue is recognized on
 proportionate basis and a contingency provision equal to 20% of the
 surplus of revenue over costs is made while anticipated losses are
 recognized in full.
 
 iii) Sales for spares is recognized on despatches/ customer acceptance
 against valid sales contracts.
 
 iv) Where sale prices are not established, sales are recognized
 provisionally at prices likely to be realized.
 
 v) Sales include excise duty wherever applicable but excludes sales tax
 and transit insurance and is adjusted for anticipated price reductions
 from contractual obligations such as de-escalation.
 
 vi) Duty drawback claims on exports are accounted on preferring the
 claims.
 
 vii) Claims for escalation are recognized on acceptance by the
 customer.
 
 viii)Where the contract provides for installation and commissioning and
 price for the same is agreed separately, revenue for installation and
 commissioning is recognized on conclusion of installation and
 commissioning. Where installation and commissioning fee is not
 separately stipulated, the estimated cost as technically assessed for
 such installation and commissioning to be incurred are provided for.
 However, the revenue for the product delivered is recognized.
 
 ix) Revenue in respect of contract involving consortium is recognized
 and disclosed at full value in compliance with the terms of consortium
 agreement and cost of items supplied by the other members of the
 consortium is deducted there from.
 
 6.  Employee Benefits:
 
 i) Short term employee benefits are recognized as an expense at the
 undiscounted amount in the profit and loss account of the year in which
 the related service is rendered.
 
 ii) Post employment and other long term employee benefits are
 recognized as an expense in the profit and loss account for the year in
 which the employee has rendered services. The expense is recognized at
 the present value of the amounts payable, determined using actuarial
 valuation techniques. Actuarial gain and losses in respect of post
 employment and other long term benefits are charged to the profit and
 loss account.
 
 7.  Accounting for Foreign Currency Transactions:
 
 i) Transactions in foreign currency are recorded in rupees by applying
 to the foreign currency amount the exchange rate existing at the time
 of the transaction.
 
 ii) The outstanding balances of monetary items relating to foreign
 currency transactions are stated in rupees by adopting the rate of
 exchange prevailing at the date of Balance Sheet. Exchange differences
 consequent to reinstatement are credited/charged to revenue.
 
 iii) The gain or loss in the conversion and/or settlement of
 liabilities incurred for acquisition of fixed assets.is either-credited
 or charged to revenue during the period such gain or loss arise.
 
 iv) Differences upon settlement of transactions, other than those
 covered by (iii) above are
 
 - credited/charged to revenue.
 
 v) In the case of forward exchange contracts, the premium or discount
 arising at the inception of the contract is accounted for over the life
 of the
 
 - contract. Exchange differences on such a contract are recognized in
 the statement of profit or loss in the reporting period in which the
 exchange rate changes.
 
 8.  Contractual Obligations:
 
 Warranty liability for contractual obligation in respect of equipments
 sold to customers is ascertained on the basis of an annual technical
 assessment.  ''
 
 9.  Research & Development:
 
 i) Research & Development expenditure is charged off in the year of
 incurrence except in the case of development of new products. The
 expenditure on development of new products is carried under inventory
 as these are meant for sale: Expenditure on fixed assets relating to
 Research & Development is capitalized.
 
 ii) Expenditure on the development of new products is treated in line
 with Accounting Policy No. 3(ii) and 3(iii) depending upon the stage of
 completion.
 
 10. Prior Period Items:
 
 Prior period adjustments are those adjustments, which are over Rs. 1
 lakh in each case, arising out of correction of errors and omissions
 made in the past years.
 
 11.  Under / Over Absorption of Cost:
 
 Adjustments for under/over absorption of costs on jobs, is made only if
 the extent of under/ over recovery exceeds one percent of turnover.
 
 12. Taxes on Income:
 
 Deferred Tax is recognized, subject to the consideration of prudence,
 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.
 
 13. Leased Assets:
 
 Assets given under operating leases are capitalized and depreciation
 charged at applicable rates. Lease rentals recovered are recognized in
 the profit and loss account.  Direct costs are expensed on incurrence.
 
 14. Others:
 
 i) The cost of special tools and jigs is amortised over production
 based on technical assessment. The value is net as per books.
 
 ii) Hand tools are charged to expenses at the time ofissue.
 
 iii) Expenditure on Voluntary Retirement Scheme is expensed in the year
 of incurrence.
 
 iv) Investments: Long-term investments are carried at cost. Permanent
 decline in the value of such investments is recognized and provided
 for. Current investments are carried at lower of cost and quoted /fair
 value.
 
 Notes annexed to and forming part of Financial Statements for the year
 ended 31st March 2011