A Basis of accounting and preparation of financial statements
 
 The financial statements of the Company have been prepared in
 accordance with the Generally Accepted Accounting Principles in India
 (Indian GAAP) to comply 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 accrual basis under the historical
 cost convention. The accounting policies adopted in the preparation of
 the financial statements are consistent with those followed in the
 previous year unless stated otherwise.
 
 B Use of estimates
 
 The preparation of the financial statements in conformity with Indian
 GAAP requires the Management to make estimates and assumptions
 considered in the reported amounts of assets and liabilities (including
 contingent liabilities) and the reported income and expenses during the
 year. The Management believes that the estimates used in preparation of
 the financial statements are prudent and reasonable. Future results
 could differ due to these estimates and the differences between the
 actual results and the estimates are recognised in the periods in which
 the results are known I materialise.
 
 C Inventories
 
 Inventories are valued at the lower of cost (on FIFO / weighted average
 basis) and the net realisable value after providing for obsolescence
 and other losses, where considered necessary. Cost includes cost of
 purchase, cost of conversion and all other costs incurred in bringing
 the goods to their respective present location and condition.
 Work-in-progress and finished goods include appropriate proportion of
 overheads and, where applicable, excise duty.
 
 D Cash and Bank Balances
 
 Cash and Bank Balances also include fixed deposits, margin money
 deposits, earmarked balances with bank, other bank balances and cash on
 hand. Cash equivalents are short-term balances (with an original
 maturity of three months or less from the date of acquisition), highly
 liquid investments that are readily convertible into known amounts of
 cash and which are subject to insignificant risk of changes in value.
 
 E Cash flow statement
 
 Cash flows are reported using the indirect method, whereby profit /
 (loss) before extraordinary items and tax is adjusted for the effects
 of transactions of non-cash nature and any deferrals or accruals of
 past or future cash receipts or payments. The cash flows from
 operating, investing and financing activities of the Company are
 segregated based on the available information.
 
 F Depreciation and amortisation .
 
 Depreciation has been provided on the straight-line method as per the
 rates prescribed in Schedule XIV to the Companies Act, 1956. The
 Vitrified Ceramic Tile Plant and the allied Machineries have been
 classified as a continuous process plant on technical assessment &
 depreciation has been provided accordingly.
 
 G Revenue recognition
 
 Sales are recognised, net of returns and trade discounts, on transfer
 of significant risks and rewards of ownership to the buyer, which
 generally coincides with the delivery of goods to customers. Sales
 include excise duty but exclude sales tax and value added tax.
 
 Export Incentives on Advance Licenses are recognized on accrual basis.
 
 Interest Income is recognized on accrual basis and dividend income is
 accounted for when the right to receive the same is established.
 
 H Tangible fixed assets
 
 Fixed assets are stated at cost net of tax /duty credits availed if any
 less accumulated depreciation and impairment losses, if any.
 
 The cost of fixed assets includes interest on borrowings attributable
 to acquisition of qualifying fixed assets upto the date the asset is
 ready for its intended use and other incidental expenses incurred up to
 that date.
 
 Exchange differences arising on restatement/ settlement of long-term
 foreign currency borrowings relating to acquisition of
 
 depreciable fixed assets are adjusted to the cost of the respective
 assets and depreciated over the remaining useful life of such assets.
 
 Subsequent expenditure relating to fixed assets is capitalised only if
 such expenditure results in an increase in the future benefits from
 such asset beyond its previously assessed standard of performance.
 
 Tangible Assets which are not ready for their intended use comprising
 direct cost, related incidental expenses and attributable interest are
 disclosed under capital work-in-progress.
 
 I Foreign currency transactions and translations
 
 Transactions in foreign currency are accounted at the exchange rate
 prevailing on the date of transaction or the rate approximate to the
 actual rate at the date of transaction. Exchange Rate fluctuation
 between the transaction date and the settlement date in respect of
 revenue transactions are recognized in Statement of Profit and Loss and
 in respect of acquisition of the fixed assets are adjusted to the cost
 of the respective assets.
 
 Non-monetary foreign currency items are carried at cost.
 
 All export proceeds / import payables not realized at the year end are
 restated at the rate prevailing at the year end. The exchange
 difference arising there on has been recognized as income / expenses in
 the current year''s Statement of Profit and Loss
 
 Monetary Assets & Liabilities denominated in Foreign Currency are
 translated at year end exchange rates and the Profit/Loss so determined
 is recognized in the Profit & Loss account.
 
 The profit/loss on cancellation or renewal of derivative instruments
 such as forward contract and option contract undertaken to hedge
 exchange fluctuation/price risks are recognized as income/expenses in
 the Statement of Profit and Loss for the year.
 
 J Investments
 
 Long-term investments are carried individually at costless provision
 for diminution, other than temporary, in the value of such investments.
 Current investments are carried individually, at the lower of cost and
 fair value. Cost of investments include acquisition charges such as
 brokerage, fees and duties.
 
 K Employee benefits
 
 Short-term employee benefits
 
 All employee benefits falling due wholly within twelve months of
 rendering service are classified as short term employee benefits. The
 benefits like salary, wages, short term compensated absences etc. and
 the expected cost of bonus / performance incentives are recognised in
 the period in which the employee renders the related service.
 
 Defined contribution plans
 
 The Company''s contribution to provident fund and employees state
 insurance scheme and other welfare funds are considered as defined
 contribution plans and are charged as an expense as they fall due based
 on the amount of contribution required to be made.
 
 Defined benefit plans
 
 The employees gratuity fund scheme managed by the trust is the
 company''e defined benefit plan. The present value of the obligation
 under such plan is determined based on acturial valuation using the
 projected unit credit method. In case such of funded plan, the fair
 value of the plan assets is reduced from the gross obligation to
 recognise such obligation on a net basis.
 
 L Borrowing costs
 
 Borrowing costs include interest, amortisation of ancillary costs
 incurred and exchange differences arising from foreign currency
 borrowings to the extent they are regarded as an adjustment to the
 interest cost. Borrowing Costs attributable to acquisition and
 construction of qualifying asset are capitalized as a part of the cost
 of such asset up to the date when such asset is ready for its intended
 use or sale. A qualifying asset is the one that necessarily takes a
 substantial period to get ready for intended use. All other borrowing
 costs are recognised as an expense in the period in which they are
 incurred.
 
 M Segment reporting
 
 The Company identifies primary segments based on the dominant source,
 nature of risks and returns and the internal organisation and
 management structure. The operating segments are the segments for which
 separate financial information is available and for which operating
 profit/loss amounts are evaluated regularly by the executive Management
 in deciding how to allocate resources and in assessing performance.
 
 The accounting policies adopted for segment reporting are in line with
 the accounting policies of the Company. Segment revenue, segment
 expenses, segment assets and segment liabilities have been identified
 to segments on the basis of their relationship to the operating
 activities of the segment.
 
 Inter-segment revenue is accounted on the basis of transactions which
 are primarily determined based on market/fair value factors.
 
 Revenue, expenses, assets and liabilities which relate to the Company
 as a whole and are not allocable to segments on reasonable basis have
 been included under unallocated revenue / expenses / assets /
 liabilities”.
 
 N Earning Per Share
 
 In determining the earnings per share, the Company considers the net
 profit/loss after tax and post tax effect of any extra-
 ordinary/exceptional item is shown separately. The number of shares
 considered in computing basic earnings per share is the weighted
 average number of shares outstanding during the year. The number of
 shares considered for computing diluted earnings per share comprises
 the weighted average number of shares used for deriving the basic
 earnings per share and also the weighted average number of equity
 shares that could have been issued on the conversion of all dilutive
 potential equity shares which includes potential CCD conversions. The
 number of shares and potentially dilutive equity shares are adjusted
 for any stock splits and bonus shares issues.
 
 O Taxes on income
 
 Provision for taxation comprises of Current tax and Deferred Tax.
 Current tax Provision has been made in accordance with the Income Tax
 Act, 1961 .Deferred tax for timing differences between the book and tax
 profits for the period is accounted for, using the tax rates and laws
 that have been substantively enacted as of the balance sheet date.
 Deferred tax assets arising from timing differences are recognized to
 the extent there is reasonable certainty that these would be realized
 in future.  Deferred tax assets are recognized on unabsorbed losses
 only if there is virtual certainty that such deferred tax asset can be
 realized against future taxable profit.
 
 P Impairment of assets
 
 An asset is treated as impaired when the carrying cost of such asset
 exceeds its recoverable value. An impairment loss is charged to
 Statement of Profit and Loss in the year in which an asset is
 identified as impaired. The impairment loss recognised in prior
 accounting period is reversed if there has been a change in the
 estimate of recoverable amount.
 
 Q Provisions, contingent liabilities and contingent assets
 
 A provision is recognised when the Company has a present obligation as
 a result of past events 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 (excluding retirement
 benefits) are not discounted to their present value and are determined
 based on the 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 best estimates. Contingent liabilities
 are disclosed in the Notes. Contingent assets are neither recognised
 nor disclosed in the financial statements.
 
 R Derivative contracts
 
 The Company enters into derivative contracts in the nature of foreign
 currency swaps, currency options, forward contracts with an intention
 to hedge its existing assets and liabilities, firm commitments and
 highly probable transactions. Derivative contracts which are closely
 linked to the existing assets and liabilities are accounted as per the
 policy stated for Foreign Currency Transactions and Translations.
 Derivative contracts designated as a hedging instrument for highly
 probable forecast transactions are accounted as per the policy stated
 for Hedge Accounting. All other derivative contracts are marked-
 to-market and losses are recognised in the Statement of Profit and
 Loss. Gains arising on the same are not recognised, until realised, on
 grounds of prudence.