1.  Security Clause :
 
 Working capital loans from consortium of bankers are secured by first
 charge on the Company''s current assets, present and future, including
 stocks, goods in process, goods in transit, receivables and book debts.
 
 These loans are further secured by pari passu charge by joint equitable
 mortgage of immovable properties of the Company situated at village
 Jambhulwadi in district Sangli and at village Velapur in district
 Solapur in Maharashtra.
 
 The above loans are further secured by personal guarantees of some of
 the Directors of the Company.
 
 Vehicle loans are secured by hypothecation of respective vehicle.
 
 2.  Deferred Tax :
 
 In view of the losses incurred by the Company during last few years,
 the Company has accumulated net deferred tax asset of Rs. 567.00 lakh
 as on 31/03/2012 (Previous year- Rs. 575 lakh) in terms of provisions
 of Accounting Standard 22 Accounting for Taxes on Income.
 
 Following prudent accounting policy and the guidelines contained in the
 Accounting Standard, the management has decided not to make adjustment
 in the books of accounts for the value of the said deferred tax asset
 until such time that there is reasonable certainty of realisation
 thereof against sufficient future taxable income.
 
                                    Current Year         Previous Year
                                    Rs. in lakhs         Rs. in lakhs
 
 3.Contingent liabilities :
 
 a) Claims against the Company not 
    acknowledged as debt Excise 
    duty claims disputed in 
    appeals                          141.62                50.32
 
 b) Letters of credit and bank 
    guarantees outstanding           231.09               142.59 
    (netof margin deposits)
 
 4.  Exceptional income :
 
 Exceptional income during the current and the previous year comprised
 of profit on sale of surplus land at non plant location.
 
 5.  Earnings in Foreign Currency :
 
 There were no exports or earnings in foreign currency during the
 current or the previous year.
 
 6.  There were no outstanding dues payable to micro, small and medium
 enterprises as on the balance sheet date. Classification of suppliers
 as micro, small and medium enterprises is done as per information
 provided by the supplier. No interest is paid/ payable during the year
 to such enterprises.
 
 7.  Balances of debtors, advances and creditors are subject to
 confirmation.
 
 8.  Previous year figures are reclassified/ regrouped, where required,
 to conform with current year presentation.