1.  Basis of Accounting
 
 The financial statements are prepared to comply in all material aspects
 with all the applicable accounting principles in India, the accounting
 standards notified under Section 211(3C) of the Companies Act, 1956 of
 India (the Act) and the relevant provisions of the Act.
 
 2.  Fixed Assets
 
 Fixed assets are stated at cost less accumulated depreciation. The
 Company capitalises all direct costs relating to the acquisition and
 installation of fixed assets. Interest on borrowed funds, if any, used
 to finance the acquisition of fixed assets, is capitalised up to the
 date the assets are ready for commercial use. Under utilised/Idle
 assets are recorded at estimated realisable value.
 
 Intangible Assets
 
 Goodwill and other Intangible Assets are amortised over the useful life
 of the assets, not exceeding 10 years.
 
 Tangible Assets
 
 Lease-hold land is being amortised over the period of lease.
 
 * In respect of buildings, estimated useful life is considered from the
 date of completion of construction.  
 
 The useful lives of the assets are based on technical estimates
 approved by the Management and are lower than the implied useful lives
 arrived on the basis of the rates prescribed under Schedule XIV to the
 Companies Act, 1956 of India.  Assets individually costing less than
 Rs. 5,000 are fully depreciated in the year of acquisition.
 
 Impairment
 
 At each Balance Sheet date, the Company reviews the carrying value of
 tangible and intangible assets for any possible impairment. An
 impairment loss is recognised when the carrying amount of an asset
 exceeds its recoverable amount. The recoverable amount is higher of the
 assets net selling price or estimated future cash flows which are
 discounted to their present value based on appropriate discount rates.
 For the purpose of assessing impairment, assets are grouped at the
 levels for which there are separately identifiable cash flows (cash
 generating unit).
 
 3.  Investments
 
 Long-term investments are valued at cost. Current investments are
 valued at lower of cost and fair value as on the date of the Balance
 Sheet. The Company provides for diminution in value of investments,
 other than temporary in nature.
 
 4.  Inventories
 
 Inventories of raw and packing materials, work-in- process and finished
 goods are valued at lower of cost and net realisable value. Cost of
 work-in- process and finished goods includes materials, labour and
 manufacturing overheads and other costs incurred in bringing the
 inventories to their present location. Cost is determined using
 standard cost method that approximates actual cost. The Company accrues
 for customs duty liability in respect of stocks of raw material lying
 in bond and excise duty liability in respect of stocks of finished
 goods lying at plant and warehouses.
 
 5.  Revenue Recognition
 
 Sales are recognised upon delivery of goods and are recorded net of
 trade discounts, rebates, sales tax/value added tax and inclusive of
 excise duty on own manufactured and outsourced products.
 
 Service Income
 
 Service Income is recognised on cost plus basis for services rendered.
 
 6.  Provisions and Contingent Liabilities
 
 The Company recognises a provision when there is a present obligation
 as result of a past event that probably requires an outflow of
 resources and a reliable estimate can be made of the amount of the
 obligation. 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. Where
 there is a possible obligation or a present obligation that the
 likelihood of outflow of resources is remote, no provision or
 disclosure as specified in Accounting Standard 29 - Provisions,
 Contingent Liabilities and Contingent Assets is made.
 
 7.  Expenditure
 
 Advertising expenses are consistently accrued and recognised in the
 year in which the related activities are carried out.
 
 The Company has Defined Contribution Plan for its employees retirement
 benefits comprising of Provident Fund and Superannuation Fund which are
 recognised by the Income Tax Authorities and administered through its
 trustees/appropriate authorities. The Company contributes to Provident
 Fund and Superannuation Fund for its employees.  In respect of
 employees covered by Provident Fund trust, interest rates payable by
 the trust to the beneficiaries every year is being notified by the
 Government. The Company has an obligation to make good the shortfall,
 if any, between the return from the investment of the trust and
 notified interest rate. The Company contributes to State Plans namely
 Employees State Insurance Fund and Employees Pension Scheme 1995.
 The Company has Defined Benefit Plan comprising of Gratuity Fund and
 Pension Scheme. The Company contributes to the Gratuity Fund which is
 recognised by the Income Tax Authorities and administered through its
 trustees. The liability for the Gratuity Fund and the Pension Scheme is
 determined on the basis of an independent actuarial valuation done at
 the year-end using Projected Unit Credit Method.  The Company
 
 has Leave Encashment Entitlements which are provided on the basis of
 independent actuarial valuation done at the year-end using Projected
 Unit Credit Method. Actuarial Gains and Losses comprise experience
 adjustments and the effect of changes in the actuarial assumptions and
 are recognised immediately in the Profit and Loss Account as income or
 expense.  Expenditure on Voluntary Retirement Scheme is charged to the
 Profit and Loss Account in the year in which it is incurred.
 
 8.  Foreign Currency Transactions
 
 Transactions in foreign currencies are recognised at the prevailing
 exchange rates on the transaction dates. Realised gains and losses on
 settlement of foreign currency transactions are recognised in the
 Profit and Loss Account. Foreign currency denominated monetary assets
 and liabilities at the year end are translated at the year-end exchange
 rates, and the resultant exchange difference is recognised in the
 Profit and Loss Account. Non Monetary foreign currency items are
 carried at cost.
 
 9.  Taxation
 
 Current tax is determined as the amount of tax payable in respect of
 taxable income for the year.  Deferred tax for timing differences
 between the income as per financial statement and income as per the
 Income-tax Act, 1961 is accounted for using the tax rates and laws that
 have been enacted or substantially enacted as of the Balance Sheet
 date. Deferred tax assets arising from the timing differences are
 recognised to the extent there is virtual certainty that sufficient
 future taxable income will be available against which such deferred tax
 assets can be realised.