i) General
 
 These accounts have been prepared under historical cost convention in
 accordance with generally accepted accounting principles and provisions
 of the Companies Act, 1956 and the Accounting Standards notified in
 Companies (Accounting Standards) Rules 2006, to the extent applicable.
 
 ii) Fixed Assets
 
 a.  Fixed Assets are stated at cost less Depreciation. Interest and
 other financial charges on loans borrowed specifically for acquisition
 of capital assets are capitalised till the start of commercial
 production.
 
 b.  All pre-operative and trial run expenditure (net of realisation, if
 any) are capitalised..
 
 c.  Projects under commissioning and other Capital Work in Progress are
 carried at cost, comprising direct cost, related incidental expenses
 and interest on borrowings made for the purpose of acquisition of fixed
 assets.
 
 iii) Intangible Assets
 
 Intangible Assets are recognised, only if it is probable that the
 future economic benefits that are attributable to the assets will flow
 to the enterprise and the cost of the assets can be measured reliably.
 The intangible assets are carried at cost less accumulated amortisation
 and accumulated impairment losses, if any.
 
 iv) Depreciation and Amortisation Tangible Assets
 
 Depreciation is provided on straight line method, except for the assets
 of Vapi, Dongari and Masat units for which depreciation is provided on
 written down value method, at the rates and in the manner prescribed
 under Schedule XIV of the Companies Act, 1956 except :
 
 a.  Block, dies & moulds are depreciated @ 95% in the year of purchase
 itself on prorata basis.
 
 b.  Lease hold land is amortised over the period of lease.
 
 Intangible Assets
 
 a.  Goodwill - Consequent to the scheme of arrangement being accounted
 for under Purchase Method by adopting book value method, the cost
 representing goodwill recognised is being amortised to Profit & Loss
 Account over, the presently estimated useful life of five years.
 
 The estimated useful life of Goodwill will be reviewed by the
 management periodically and changes therein will be taken cognigence
 of, by accelerating or decelerating the pace of amortisation.
 
 b.  Trade Mark and other intangible assets :- Trade Marks and other
 Intangible assets are amortised over a period not exceeding 10 years.
 
 c.  Software is depreciated @ 16.21% on Straight Line Method except for
 Vapi, Dongari and Masat Units which is amortised @ 20%.
 
 v) Investments
 
 Long Term Investments are stated at cost. Current Investments are
 stated at cost or fair value whichever is lower.  Diminution in value
 of long term investments other than temporary in nature is charged to
 Profit & Loss Account.
 
 vi) Inventories
 
 The inventories are valued at cost or net realisable value whichever is
 lower except for work in progress and advertising material which are
 valued at cost. The Cost is calculated on weighted average method. Cost
 comprises of expenditure incurred in the normal course of business in
 bringing such inventories to its location and includes, where
 applicable, appropriate overheads based on normal level of activity.
 
 vii) Research & Development
 
 Revenue expenditure on Research and Development is charged against the
 Profit for the year.
 
 viii) Retirement benefits
 
 a.  The Company makes contributions towards provident fund and
 superannuation fund to a defined contribution retirement benefit plan
 for qualifying employees. Both the employees and the Company make
 monthly contributions to the Provident Fund Plan equal to a specified
 percentage of the covered employee''s salary.
 
 In Vapi, Dongari and Masat Units the superannuation fund is
 administered by the Life Insurance Corporation of India (LIC). Under
 the plan, the Company is required to contribute a specified amount to
 the retirement benefit plan to fund the benefits.
 
 b.  Provision for Leave encashment and Gratuity is made on the basis of
 actuarial valuation as at the year ended as per the requirements of
 Accounting Standard -15 (revised 2005) on “Employee Benefits”.
 
 c.  The Company has defined benefit plan comprising of Gratuity fund
 with Life Insurance Corporation of India. In Vapi, Dongari and Masat
 units the Leave Fund is with Life Insurance Corporation of India.
 
 d.  Actuarial gains and losses comprise experience adjustments and the
 effect of changes in the actuarial assumptions are recognised
 immediately in the Profit and Loss Account as income or expense.
 
 ix) Voluntary Retirement Scheme
 
 Expenditure incurred on voluntary retirement scheme is charged to
 profit in the year in which it is incurred.
 
 x) Sales
 
 Sales include duty drawback, license premium on exports, Sales Tax and
 are recorded net of Trade discounts and other rebates.
 
 xi) Provisions and Contingent Liabilities
 
 Provisions are recognised when the Company has a legal and constructive
 obligation as a result of a past event, for which it is probable that a
 cash outflow will be required and a reliable estimate can be made of
 the amount of the obligation. Contingent liabilities are disclosed when
 the Company has a possible obligation or a present obligation and it is
 probable that a cash outflow will not be required to settle the
 obligation. Provisions & Contingent Liabilities are revalued at each
 Balance Sheet date.
 
 xii) Government Grants
 
 Grants and subsidies from the government are recognised when there is
 reasonable assurance that the grant/subsidy will be received and all
 attaching conditions will be complied with.
 
 When the grant or subsidy relates to an expense item, 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. Where the grant
 or subsidy relates to an asset, its value is deducted in arriving at
 the carrying amount of the related asset. Government grant in the
 nature of promoters'' contribution is credited to the capital subsidy
 reserve.
 
 xiii) Revenue Recognition
 
 Income & expenditure are recognised on accrual basis.
 
 xiv) Foreign Currency Transactions
 
 a. Transactions in foreign exchange which are covered by forward
 contracts are accounted for at the contracted rates, the difference
 between the contracted rate and the exchange rate at the date of
 transaction is recognised in Profit & Loss Account. Difference relating
 to transactions involving more than one financial year are carried over
 the period of transaction. In respect of forward contracts which are
 entered into to hedge highly probable forecasted transactions the cost
 of these contracts, if any, is expensed at the end of the contract.
 
 Transactions other than those covered by forward contracts are
 recognised at the exchange rate prevailing on date of transaction.
 Gains & losses arising on account of realisation are accounted for in
 Profit & Loss Account.
 
 b.  Monetary Assets & Liabilities in foreign currency that are
 outstanding at the year end and not covered by forward contracts are
 translated at the year end exchange rates.
 
 c.  The exchange differences arising from long term foreign currency
 monetary items relating to the acquisition of a depreciable asset are
 added to or deducted from the cost of the depreciable capital asset.
 Exchange differences are recognized as income or expenses in the Profit
 & Loss Account.
 
 d.  In respect of foreign currency option contracts which are entered
 into to hedge highly probable forecasted transactions the cost of these
 contracts, if any, is expensed over the period of the contract. Any
 profit or loss arising on settlement or cancellation of currency
 options is recognised as income or expenses for the period in which
 settlement or cancellation takes place. The effect of this currency
 options contracts outstanding at the year end, in the form of
 unrealised gains/ losses, is not recognised.
 
 xv) Excise Duty
 
 Excise duty payable on products is accounted for at the time of
 despatch of goods from the factories and is included in stocks held at
 the year end.
 
 xvi) 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. All other borrowing costs are charged to revenue. A
 qualifying asset is one that necessarily takes substantial period of
 time to get ready for its intended use.
 
 xvii) Taxation
 
 Provision for tax is made for both current and deferred taxes.
 Provision for current tax is made at the current tax rates based on
 assessable income. Deferred income tax reflect the 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 assets are recognised only to the extent that there is
 virtual certainty supported by convincing evidence that sufficient
 future taxable income will be available against which such deferred tax
 assets can be realised.
 
 xviii) Impairment of Assets
 
 The Company identifies impairable assets at the year end in accordance
 with the guiding principles of Accounting Standard 28, notified in
 Companies (Accounting Standards ) Rules 2006, for the purpose of
 arriving at impairment loss thereon being the difference between the
 book value and recoverable value of relevant assets. Impairment loss,
 when crystalises, are charged against revenues for the year. If at the
 balance sheet date there is an indication that a previously assessed
 impairment loss no longer exists, the recoverable amount is reassessed
 and the asset is reflected at the recoverable amount.