i) Accounting Convention :
 
 The financial statements are prepared under the historical cost
 convention, having due regard to fundamental accounting assumptions of
 going concern, consistency and accrual, in compliance with the
 accounting standards referred to in Section 211(3C) of the Companies
 Act, 1956.
 
 ii) Fixed Assets :
 
 a) Fixed Assets are stated at cost of acquisition or construction less
 accumulated depreciation. Attributable finance costs and expenses of
 bringing the respective assets to working condition for their intended
 use are capitalised.
 
 b) Impairment: The carrying amount of cash generating units /assets is
 reviewed at balance sheet date to determine whether there is any
 indication of impairment. If any such indication exists, the
 recoverable amount is estimated as the higher of net selling price and
 value in use. Impairment loss is recognised whenever carrying amount
 exceeds the recoverable amount.
 
 c) Borrowing costs that are directly attributable to the acquisition or
 production of a qualifying asset are capitalised as part of the cost of
 those assets. Other borrowing costs are recognised as expense in the
 period in which they are incurred.
 
 iii) Depreciation:
 
 a) Depreciation is provided on Straight-Line Method at the rates and in
 the manner specified in Schedule XIV to the Companies Act, 1956.
 
 b) Amortisation is provided in respect of leasehold land.
 
 iv) Valuation of Investments:
 
 Investments classified as long term Investments are stated at cost.
 Provision for diminution, if any, in the value of long-term investments
 is made to recognise a decline other than temporary in the fair value
 of investments. The fair value of a long term investment is ascertained
 with reference to its market value, investees assets and results and
 the expected cash flows from the investment as well as the strategic
 importance to the
 
 Company.
 
 Current investments are valued at lower of cost and fair value.
 
 v) Valuation of Inventories:
 
 Inventories are valued at lower of cost and net realisable value. Cost
 is determined on weighted average method. Cost of semi-finished and
 finished goods comprises of materials, conversion cost and excise duty
 wherever applicable.
 
 vi) Foreign Currency Transactions:
 
 a) Transactions in foreign currencies are recorded at the exchange rate
 prevailing on the date of the transaction. Monetary Assets &
 Liabilities denominated in foreign currency are translated at the
 year-end rate. The exchange difference between the rate prevailing on
 the date of transaction and on the date of settlement as also on
 translation of Monetary Assets and Liabilities at the end of the year
 including exchange difference related to purchase of fixed assets is
 recognised as income or expense, as the case may be.  b) The company
 uses foreign exchange forward contracts and options to reduce the cost
 or to hedge its risks associated with foreign currency fluctuations to
 underlying transactions, for certain firm commitments or forecasted
 transactions.  The difference between the forward rate and the exchange
 rate at the inception of the forward contract for underlying
 transaction is recognised as income or expense over the life of the
 contract. In respect of hedge contracts, for firm commitment or
 forecasted transactions, the attributable gain or loss is taken to
 profit and loss account on accrual and / or on settlement as the case
 maybe. Loss if any, in respect of outstanding derivatives at the
 balance sheet date is assessed by the management based on the principle
 of prudence and charged to profit and loss account of that period.
 
 vii) Revenue Recognition:
 
 Sale of goods is recognised on dispatches to customers, which coincide
 with the transfer of significant risks and rewards associated with
 ownership, inclusive of excise duty and net of discount.
 
 Dividend income is accounted for when the right to receive is
 established.
 
 Interest income is recognised on a time proportion basis taking into
 account the amount outstanding and the rate applicable.
 
 viii) Employee Benefits:
 
 a) Defined Contribution Plan: Contributions are made to approved
 Superannuation and Provident Fund.
 
 b) Defined Benefit Plan: Companys liability towards gratuity is
 determined using the projected unit credit method which considers each
 period of service as giving rise to an additional unit of benefit
 entitlement and measures each unit separately to build up the final
 obligation.  Past Service Gratuity Liability is computed with reference
 to the service put in by each employee till the date of valuation as
 also the projected terminal salary at the time of exit. Actuarial gain
 or losses are recognised immediately in the Statement of Profit and
 Loss as income or expense. Obligation is measured at the present value
 of estimated future Cash Flow using a discount rate that is determined
 by reference to market yields at the Balance Sheet date on government
 bonds where the currency and terms of the government bonds are
 consistent with the currency and estimated terms of the defined benefit
 obligation.
 
 c) Short Term Compensated Absences: Liability on account of encashment
 of leave to employee is considered as short term compensated expense
 provided on actual.
 
 ix) Taxation:
 
 Current tax is determined as the amount of tax payable in respect of
 taxable income for the year. The deferred tax for timing difference
 between the book and tax profit for the year is accounted for using tax
 rates and tax laws that have been enacted or substantially enacted at
 the Balance Sheet date (except to the extent reversing in the tax
 holiday period).  Deferred Tax assets arising from the timing
 differences are recognised to the extent that there is virtual
 certainty that sufficient future taxable income will be available.
 
 x) Provisions and contingent liabilities:
 
 a) Provisions in respect of present obligations arising out of past
 events are made in the accounts when reliable estimates can be made of
 the amount of the obligation.
 
 b) Contingent liabilities are disclosed by way of note to the financial
 statements after careful evaluation by the management of the facts and
 legal aspects of the matter involved.
 
 xi) Accounting for leases:
 
 Assets given on lease where significant portion of risks and rewards
 incidental to the ownership are retained are classified as Operating
 lease. Lease rentals are recognised on straight line basis over the
 lease term.