1.1 BASIS FOR PREPARATION
 
 The financial statements of the company have been prepared in
 accordance with generally accepted accounting principles in India
 (Indian GAAP). The company has prepared these financial statements to
 comply in all material respects with the accounting standards notified
 under the Companies (Accounting Standards) Rules, 2006 (as amended) and
 the relevant provisions of the Companies Act, 1956. The financial
 statements have been prepared on an accrual basis (unless otherwise
 stated) and under historical cost convention. The accounting policies
 are consistent with those used in previous year except for the policy
 in respect of foreign exchange differences referred to in para 1.13.iv.
 
 1.2 USE OF ESTIMATES
 
 The preparation of financial statements requires the management of the
 company to make certain estimates and assumptions that affect the
 amounts reported in the financial statements and notes thereto.
 Differences, if any, between actual amounts and estimates are
 recognised in the period in which the results are known.
 
 1.3 FIXED ASSETS
 
 i) TANGIBLE FIXED ASSETS
 
 a) Fixed Assets are stated at cost net of accumulated depreciation.
 
 b) Subsequent expenditure related to an item of fixed asset is added to
 its book value only if it increases the future benefits from the
 existing asset beyond its previously assessed standard of performance.
 
 c) Expenditure on assets, other than plant and machinery, LPG cylinders
 and pressure regulators, not exceeding Rs. 1,000 per item are charged to
 revenue.
 
 d) Machinery spares that are specific to a fixed asset are capitalised
 along with the fixed asset. Replacement of such spares is charged to
 revenue.
 
 e) Land acquired on lease where period of lease exceeds 99 years is
 treated as freehold land.
 
 f) Expenditure during construction period: Direct expenses including
 borrowing cost incurred during construction period on capital projects
 are capitalised. Indirect expenses of the project group which are
 allocated to projects costing Rs. 5 crores and above are also
 capitalised. Crop compensation expenses incurred in the process of
 laying pipelines are capitalised. Expenditure incurred generally during
 construction period of projects on assets like electricity transmission
 lines, roads, culverts etc. the ownership of which is not with the
 company are charged to revenue in the accounting period of incurrence
 of such expenditure.
 
 ii) INTANGIBLE ASSETS
 
 a) Intangible assets are carried at cost less accumulated amortisation.
 
 b) Cost of right of way that is perennial in nature is not amortised as
 no finite useful life can be identified for the same.
 
 c) Expenditure incurred for creating/acquiring other intangible assets
 of Rs. 0.50 crores and above, from which future economic benefits will
 flow over a period of time, is amortised over the estimated useful life
 of the asset or five years, whichever is lower, from the time the
 intangible asset starts providing the economic benefit.
 
 d) In other cases, the expenditure is charged to revenue in the year
 the expenditure is incurred.
 
 1.4 IMPAIRMENT OF ASSETS
 
 The values of tangible and intangible assets of respective Cash
 Generating Units are reviewed by the management for impairment at each
 Balance Sheet date, if events or circumstances indicate that the
 carrying values may not be recoverable. If the carrying value is more
 than the net selling price of the asset or present value, the
 difference is recognised as an impairment loss.
 
 1.5 BORROWING COSTS
 
 Borrowing costs that are attributable to the acquisition or
 construction of qualifying assets are capitalised as part of the cost
 of such assets till the month in which the asset is ready for use. All
 other borrowing costs are charged to revenue.
 
 1.6 DEPRECIATION
 
 i.  Depreciation on fixed assets is provided under the straight line
 method, at rates prescribed under Schedule XIV to the Companies Act,
 1956, except in following cases :
 
 a) Premium paid for acquiring leasehold land for lease period not
 exceeding 99 years, is amortised over the period of lease.
 
 b) Fixed assets costing not more than Rs. 5,000 each, LPG cylinders and
 pressure regulators are depreciated @ 100 percent in the year of
 acquisition.
 
 c) Computer equipment and peripherals, and mobile phones are
 depreciated over a period of 4 years.  Furniture provided at the
 residence of management staff is depreciated over a period of seven
 years.
 
 ii.  Depreciation is charged on addition / deletion on pro-rata monthly
 basis including the month of addition / deletion.
 
 1.7 INVESTMENTS
 
 i.  Current investments are valued at lower of cost or fair value
 determined on an individual investment basis.
 
 ii.  Long-term investments are valued at cost. Provision for diminution
 in value is made to recognise a decline, other than of temporary
 nature, in the value of such investments.
 
 1.8 INVENTORY
 
 i.  Inventories are stated at cost or net realisable value, whichever
 is lower. Cost is determined on weighted average basis and comprises of
 expenditure incurred in the normal course of business in bringing
 inventories to their present location including appropriate overheads
 apportioned on a reasonable and consistent basis.
 
 ii.  The net realisable value of finished goods and stock in trade are
 based on the inter-company transfer prices and final selling prices
 (applicable at the location of stock) for sale to oil companies and
 retail consumers respectively. For the purpose of stock valuation, the
 proportion of oil companies sales and retail sales are determined on
 all India basis and this is considered for stock valuation at all
 locations.
 
 iii. Stock-in-process is valued at raw material cost plus cost of
 conversion.
 
 iv.  Obsolete, slow moving, surplus and defective stocks are identified
 at the time of physical verification of stocks and where necessary,
 provision is made for such stocks.
 
 1.9 REVENUE RECOGNITION
 
 i.  Sales represents invoiced value of goods supplied net of trade
 discounts, and include applicable excise duty, surcharge and other
 elements as are allowed to be recovered as part of the price but
 excludes VAT / Sales Tax. Further, it includes other elements allowed
 by the Government from time to time.
 
 ii.  Claims including subsidy on LPG and SKO from Government of India
 are booked on '' in principle acceptance'' thereof on the basis of
 available instructions/clarifications subject to final adjustments
 after necessary audit, as stipulated.
 
 iii. Other claims are booked when there is a reasonable certainty of
 recovery. Claims are reviewed on a periodical basis and if recovery is
 uncertain, provision is made in the accounts.
 
 iv.  Income from sale of scrap is accounted for on realisation.
 
 v.  Dividend income is recognised when the company''s right to receive
 the dividend is established.
 
 vi.  Interest income is recognised on a time proportion basis taking
 into account the amount outstanding and the applicable interest rate.
 
 1.10 CLASSIFICATION OF INCOME / EXPENSES
 
 i.  Expenditure on Research, other than capital expenditure, is charged
 to revenue in the year in which the expenditure is incurred.
 
 ii.  Income/expenditure upto Rs. 0.05 crore in each case pertaining to
 prior years is charged to the current year.
 
 iii. Prepaid expenses upto Rs. 0.05 crore in each case, are charged to
 revenue as and when incurred.
 
 iv.  Deposits placed with Government agencies/ local authorities which
 are perennial in nature are charged to revenue in the year of payment.
 
 1.11 EMPLOYEE BENEFITS
 
 i.  Contributions to defined contribution schemes such as Pension,
 Superannuation, Provident Fund, etc. are charged to the Statement of
 Profit and Loss as and when incurred.
 
 ii.  The Company also provides for retirement/ post-retirement benefits
 in the form of gratuity, leave encashment, post retirement benefits and
 other long term benefits. Such defined benefits are charged to the
 Profit and Loss account based on valuations made by independent
 actuaries using the Projected Unit Credit Method, as at the balance
 sheet date.
 
 iii. Payments made under Voluntary Retirement Scheme are charged to
 Statement of Profit and Loss.
 
 1.12 DUTIES ON BONDED STOCKS
 
 i.  Customs duty on Raw materials/Finished goods lying in bonded
 warehouse are provided for at the applicable rates except where
 liability to pay duty is transferred to consignee.
 
 ii.  Excise duty on finished stocks lying in bond is provided for, at
 the assessable value applicable at each of the locations at maximum
 rates based on end use.
 
 1.13 FOREIGN CURRENCY & DERIVATIVE TRANSACTIONS
 
 i.  Transactions in foreign currency are accounted in the reporting
 currency at the exchange rate prevailing on the date of transaction.
 
 ii.  Monetary items denominated in foreign currency are converted at
 exchange rates prevailing on the date of Balance Sheet.
 
 iii. Foreign Exchange differences arising at the time of translation or
 settlement are recognised as income or expense in the Statement of
 Profit & Loss either under foreign exchange fluctuation or interest, as
 the case may be.
 
 iv.  However, foreign exchange differences on long term foreign
 currency monetary items relating to acquisition of depreciable assets
 are adjusted to the carrying cost of the assets and depreciated over
 the balance life of the asset and in other cases, if any, accumulated
 in Foreign Currency Monetary Item Translation Difference Account
 and amortised over the balance period of the asset or liability.
 
 v.  Premium / discount arising at the inception of the forward exchange
 contracts to hedge foreign currency risks are amortised as expense or
 income over the life of the contract. Exchange differences on such
 contracts are recognised in the Statement of Profit & Loss.
 
 vi.  Gains / losses arising on settlement of Derivative transactions
 entered into by the Corporation to manage the commodity price risk and
 exposures on account of fluctuations in interest rates and foreign
 exchange are recognised in the Statement of Profit and Loss. Provision
 for losses in respect of outstanding contracts as on balance sheet date
 is made based on mark to market valuations of such contracts.
 
 1.14 GOVERNMENT GRANTS
 
 i.  When the grant relates to an expense item or depreciable fixed
 assets, it is recognised as income over the periods necessary to match
 them on a systematic basis to the costs, which it is intended to
 compensate.  The grant relating to future years are treated as Deferred
 Income and reflected as Capital Reserve in Balance Sheet.
 
 ii.  Government grants of the nature of promoters'' contribution or
 relating to non depreciable assets are credited to capital reserve and
 treated as a part of shareholders'' funds.
 
 1.15 PROVISIONS, CONTINGENT LIABILITIES AND CAPITAL COMMITMENTS
 
 i.  A provision is recognised when an enterprise has a present
 obligation as a result of past events; it is probable that an outflow
 of resources will be required to settle the obligation and in respect
 of which a reliable estimate can be made.
 
 ii.  Contingent Liabilities are not recognised but are disclosed in the
 Notes. Contingent liabilities are disclosed in respect of possible
 obligations that arise from past events but their existence is
 confirmed by the occurrence or non-occurrence of one or more uncertain
 future events not wholly within the control of the Corporation.
 
 iii. Capital commitments and Contingent liabilities disclosed are in
 respect of items which exceed Rs. 0.05 crore in each case.
 
 1.16 TAXES ON INCOME
 
 i.  Provision for current tax is made after taking into consideration
 benefits admissible under the provisions of the Income Tax Act, 1961.
 
 ii.  Deferred tax resulting from timing differences between book
 and taxable profit is accounted for using the tax rates and laws that
 have been enacted or substantively enacted as on the balance sheet
 date.
 
 iii. The deferred tax asset is recognised and carried forward only to
 the extent that there is a reasonable certainty that the assets will be
 realised in future. However, in respect of unabsorbed depreciation or
 carry forward losses, the deferred tax asset is recognised and carried
 forward only to the extent that there is a virtual certainty that the
 assets will be realised in future.
 
 iv.  The carrying amount of deferred tax assets and unrecognised
 deferred tax assets are reviewed at each balance sheet date.
 
 1.17 EARNINGS PER SHARE
 
 Basic earnings per share are calculated by dividing the net profit or
 loss for the period attributable to equity share holders (after
 deducting preference dividends, if any, and attributable taxes) by the
 weighted average number of equity shares outstanding during the period.
 
 For the purpose of calculating diluted earnings per share, the net
 profit or loss for the period attributable to equity shareholders and
 the weighted average number of shares outstanding during the period are
 adjusted for the effect of all dilutive potential equity shares.