1.  Basis of Accounting
 
 The financial statements have been prepared to comply in all material
 respects with the mandatory Accounting Standards issued by the
 Institute of Chartered Accountants of India and the relevant provisions
 of the Companies Act, 1956. The financial statements have been prepared
 under the historical cost convention on an accrual basis. The
 accounting policies have been consistently applied by the Company.
 
 2.  Use of Estimates
 
 The preparation of financial statements requires making certain
 estimates and assumptions necessary for reporting of amounts in the
 financial statements and notes thereto. Differences, if any, between
 actual and estimates are recognized in the period in which they
 materialize.
 
 3.  Fixed Assets
 
 Fixed assets are stated at cost, less accumulated depreciation. Cost
 comprises of the purchase price and any attributable cost of bringing
 the asset to its working condition for its intended us©. Financing
 costs related to acquisition of fixed assets are also included to the
 extent they relate to the period till such assets are ready to be put
 to use.
 
 4.  Depreciation/Amortisation
 
 a.  Depreciation is provided on fixed assets, under Straight Line
 Method at rates prescribed in Schedule XIV to the Companies Act, 1956.
 Depreciation on additions/deletions during the year is provided on
 pro-rata basis.
 
 b.  Premiums other expenditure on leasehold land is amortized over the
 period of lease.  >
 
 5.  Inventories
 
 a.  Raw Material, components, stores and spares are valued at 60 % of
 purchase price due to deteriorations as certified by Technical &
 Production Director and land (stock in trade) are valued at lower of
 cost or net realizable value. Cost is determined on First in First out
 (FIFO) basis.
 
 b.  Work-in-progress in respect of construction activity is valued at
 cost. Cost includes land cost, direct materials and labour and a
 proportion of operating overheads including borrowing costs. In case
 work is completed for more than 25% of the total work in each case,
 work-in-progress is valued inclusive of estimated profit on percentage
 completion basis.
 
 c Finished goods are valued at 40 % of net realizable value as taken in
 declared results of the company for the 3 rd quarter of the year due to
 deteriorations as certified by Technical & Production Director.
 
 
 Cost includes direct materials and labour and proportion of
 manufacturing overheads based on — normal operating capacity. Nel
 realizable value is the estimated selling price in the ordinary course
 of business.
 
 d..  Stock in Trade / transit is valued at cost.
 
 6.  Revenue Recognition
 
 a.  Sales are excluding duties and faxes, net of usual trade discounts.
 Revenue from sale of goods is recognized en the basis of dispatch of
 goods when ownership, risk & reward is transferred to the customers.
 
 b.  Sales of construction activity are excluding duties and taxes.
 Revenue from sale of property is recognized on transfer of ownership to
 the customers. Revenue from construction contracts is recognized on the
 basis of bills submitted on certification of work carried out.
 
 c.  Revenue from interest is recognized on time proportion basis.
 
 
 7.  Foreign Currency Transactions
 
 a.  Transactions denominated in foreign currencies are recorded at the
 exchange rate prevailing at the time, of transaction.
 
 b.  Monetary assets and liabilities denominated in foreign currencies
 are translated into rupee currency at the year end. Non-monetary
 foreign currency assets are carried at cost.
 
 c.  Any gains or losses on account of exchange differences either on
 settlement or on transaction are recognized in the profit and loss
 account.
 
 8.  Retirement benefits and other employee benefits (AS -15)
 
 Retirement benefits and other employee benefits in the form of
 Provident Fund and Gratuity are charged to Profit & Loss account of the
 year when the contribution to the respective fund fs due.
 
 9.  Taxation
 
 Tax expense comprises of both current and deferred taxes. Current
 income tax is measured at the amount expected to be paid to the tax
 authorities in accordance with the Income Tax Act. Deferred income
 taxes reflect. the combined impact of current year timing differences
 between taxable income and accounting income for the year and reversal
 of timing differences of earlier years. Deferred tax is measured based
 on the tax rates and the tax laws enacted at the balance sheet date.
 Deferred tax assets are recognized only to the extent that there is
 reasonable certainty that sufficient future taxable income will be
 available against which such deferred tax assets can be realized.
 
 10.  Impairment Loss
 
 As per Accounting Standard AS-28 Impairment of Assets'' effective from
 April 01, 2004, the Company assesses at each Balance Sheet date whether
 there is any indication that any asset may be impaired and if such
 indication exists, the carrying value of such asset is reduced to its
 recoverable amount and a provision is made for such impairment loss in
 the Profit and Loss Account.
 
 11.  Borrowing Costs
 
 Borrowing Costs attributable to the acquisition and construction of the
 qualifying assets are capitalized as part of the cost of respective
 assets up to the date when such asset is ready for its intended use. A
 qualifying asset is one that necessarily takes substantial period of
 time to get ready for intended use.  Other borrowing costs are charged
 to Profit & Loss Account.
 
 12.  Earning Per Share
 
 Basic Earning per share is calculated by dividing the net profit for
 the year attributable to equity shareholders by the weighted average
 number of equity shares outstanding during the year. The
 
 Company has not issued any dilutive potential equity shares and
 accordingly, the basic earning per share and diluted earning per share
 are the same.
 
 13. Provisions, Contingent Liabilities and Contingent Assets
 
 A Provision is recognized when an enterprise has a present obligation
 as a result of past event and it is probable that an outflow of
 resources will be required to settle the obligation, in respect of
 which a reliable estimate can be made. Provisions are not discounted to
 their present value and are determined based on best estimate required
 to settle the obligation at the balance sheet date These are reviewed
 at each balance sheet date and adjusted to* reflect the current bes.t
 estimates. Contingent liabilities if material are disclosed by way of
 notes to accounts. Contingent assets are not recognized.