(a) Accounting Convention :
 
 The financial statements are prepared under the historical cost
 convention, in accordance with Generally Accepted Accounting Principles
 in India, the Accounting Standards issued by the Institute of Chartered
 Accountants of India and the provisions of the Companies Act, 1956 to
 the extent applicable.
 
 (b) Use of Estimates :
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles requires the management to make
 estimates and assumptions that affect the reported balances of assets
 and liabilities as of the date of the financial statements and reported
 amounts of income and expenses during the period. Management believes
 that the estimates used in the preparation of financial statements are
 prudent and reasonable. Actual results could differ from the estimates.
 
 (c) Fixed Assets :
 
 Fixed assets are stated at cost less accumulated depreciation and
 impairment. Cost includes expenses related to acquisition and
 borrowings cost during construction period. Exchange differences on
 repayment and year end translation of foreign currency liabilities
 relating to acquisition of assets are adjusted to the carrying cost of
 the assets.
 
 (d) Investments :
 
 (i) Investments are classified into long term and current investments.
 
 (ii) Long term investments are carried at cost. Provision for
 diminution, if any, in the value of each long term investment is made
 to recognise a decline, other than of a temporary nature.
 
 (iii) Current investments are stated at lower of cost and fair value
 and the resultant decline, if any, is charged to revenue
 
 (e) Inventories :
 
 Inventories of fuel oil are carried at lower of cost or net realisable
 value. Cost is ascertained on first-in-first out basis.
 
 (f) Incomplete Voyages :
 
 Incomplete voyages represent freight received and direct operating
 expenses in respect of voyages which were not complete as at the
 Balance Sheet date.
 
 (g) Borrowing Costs :
 
 Borrowing costs that are directly attributable to the acquisition /
 construction of the qualifying assets are capitalised as part of the
 cost of the asset, upto the date of acquisition / completion of
 construction.
 
 (h) Revenue Recognition :
 
 Freight and demurrage earnings are recognised on completed voyage
 basis. Charter hire earnings are accrued on time basis except where the
 charter party agreements have not been renewed/finalised, in which case
 it is recognised on provisional basis.
 
 (i) Operating Expenses :
 
 (i) Fleet direct operating expenses are charged to revenue on completed
 voyage basis.
 
 (ii) Stores and spares delivered on board the ships are charged to
 revenue.
 
 (iii) Expenses on account of general average claims/damages to ships
 are written off in the year in which they are incurred. Claims against
 the underwriters are accounted for on submission of average adjustment
 by the adjustors.
 
 (j) Employee Benefits :
 
 Liability is provided for retirement benefits of provident fund,
 superannuation, gratuity and leave encashment in respect of all
 eligible employees and for pension benefit to Whole-time Directors of
 the Company.
 
 (i) Defined Contribution Plan
 
 Employee benefits in the form of Superannuation Fund, Provident Fund
 and other Seamens Welfare Contributions are considered as defined
 contribution plans and the contributions are charged to the Profit and
 Loss of the period when the contributions to the respective funds are
 due.
 
 (ii) Defined Benefit Plan
 
 Retirement benefits in the form of Gratuity and the Pension plan for
 Whole-time Directors are considered as defined benefit obligations and
 are provided for on the basis of actuarial valuations, using the
 projected unit credit method, as at the date of the Balance Sheet.
 
 (iii) Other Long Term Benefits
 
 Long term compensated absences are provided for on the basis of an
 actuarial valuation, using the projected unit credit method, as at the
 date of the Balance Sheet.
 
 Actuarial gain/losses, comprising of experience adjustments and the
 effects of changes in actuarial assumptions are immediately recognised
 in the Profit and Loss Account.
 
 (k) Depreciation :
 
 (i) Depreciation is provided so as to write off 95% of the original
 cost of the asset over the estimated useful life or at rates prescribed
 under the Schedule XIV to the Companies Act, 1956, whichever is higher.
 The basis for charging depreciation and the estimated useful life of
 the assets is as under :
 
 (ii) Depreciation on fleet is provided on prorata basis and on Other
 Assets depreciation is provided for the full year on additions and no
 depreciation is provided in the year of disposal.
 
 (iii) In case of assets depreciated under the straight line method, 95%
 of the original cost is written off over the estimated useful life.
 However, if an asset continues in operation beyond the useful life, as
 estimated by the management, the balance cost is depreciated in the
 subsequent year.
 
 (l) Asset Impairment :
 
 The carrying amounts of the Companys tangible and intangible assets
 are reviewed at each balance sheet date to determine whether there is
 any indication of impairment. If any such indication exists, the
 assets recoverable amounts are estimated in order to determine the
 extent of impairment loss, if any. An impairment loss is recognised
 whenever the carrying amount of an asset exceeds its recoverable
 amount. The impairment loss, if any, is recognised in the statement of
 Profit and Loss in the period in which impairment takes place.
 
 Where an impairment loss subsequently reverses, the carrying amount of
 the asset is increased to the revised estimate of its recoverable
 amount, however subject to the increased carrying amount not exceeding
 the carrying amount that would have been determined (net of
 amortisation of depreciation) had no impairment loss been recognised
 for the asset in prior accounting periods.
 
 (m) Foreign Exchange Transactions :
 
 (i) Transactions in foreign currency are recorded at standard exchange
 rates determined monthly. Monetary assets and liabilities denominated
 in foreign currency, remaining unsettled at the period end are
 translated at closing rates. The difference in translation of long-term
 monetary assets and liabilities and realised gains and losses on
 foreign currency transactions relating to acquisition of depreciable
 capital assets are added to or deducted from the cost of the asset and
 depreciated over the balance life of the asset and in other cases
 accumulated in a Foreign Currency Monetary Item Translation Difference
 Account and amortised over the balance period of such long term
 asset/liability, but not beyond March 31, 2011 by recognition as income
 or expense. The difference in translation of all other monetary assets
 and liabilities and realised gains and losses on other foreign currency
 transactions are recognised in the Profit and Loss Account.
 
 (ii) Forward exchange contracts other than those entered into to hedge
 foreign currency risk of firm commitments or highly probable forecast
 transactions are translated at period end exchange rates and the
 resultant gains and losses as well as the gains and losses on
 cancellation of such contracts are recognised in the Profit and Loss
 Account, except in case of contracts relating to the acquisition of
 depreciable capital assets, in which case they are added to or deducted
 from the cost of the assets. Premium or discount on such forward
 exchange contracts is amortised as income or expense over the life of
 the contract.
 
 (iii) Currency swaps which form an integral part of the loans are
 translated at closing rates and the resultant gains and losses are
 dealt with in the same manner as the translation differences of long
 term monetary assets and liabilities.
 
 (n) Derivative Financial Instruments and Hedging :
 
 The Company enters into derivative financial instruments to hedge
 foreign currency risk of firm commitments and highly probable forecast
 transactions, interest rate risk and bunker price risk. The method of
 recognising the resultant gain or loss depends on whether the
 derivative is designated as a hedging instrument, and if so, the nature
 of the item being hedged. The carrying amount of a derivative
 designated as a hedge is presented as a current asset or a liability.
 The company does not enter into any derivatives for trading purposes.
 
 Cash Flow Hedge :
 
 Forward exchange contracts entered into to hedge foreign currency risks
 of firm commitments or highly probable forecast transactions, forward
 rate options, currency and interest rate swaps and commodity future
 contracts, that qualify as cash flow hedges are recorded in accordance
 with the principles of hedge accounting enunciated in Accounting
 Standard (AS) 30 – Financial Instruments : Recognition and Measurement.
 The gains or losses on designated hedging instruments that qualify as
 effective hedges is recorded in the Hedging Reserve account and is
 recognised in the statement of Profit and Loss in the same period or
 periods during which the hedged transaction affects profit and loss or
 is transferred to the cost of the hedged non-monetary asset upon
 acquisition.
 
 Gains or losses on the ineffective transactions are immediately
 recognised in the Profit and Loss account. When a forecasted
 transaction is no longer expected to occur the gains and losses that
 were previously recognised in the Hedging Reserve are transferred to
 the statement of Profit and Loss immediately.
 
 (o) Provision for Taxation :
 
 Tax expense comprises both current and deferred tax.
 
 (i) Provision for current income-tax is made on the basis of the
 assessable income under the Income-tax Act, 1961. Income from shipping
 activities is assessed on the basis of deemed tonnage income of the
 Company.
 
 (ii) Deferred income-tax is recognised on timing differences, between
 taxable income and accounting income which originate in one period and
 are capable of reversal in one or more subsequent periods only in
 respect of the non-shipping activities of the Company.  The tax effect
 is calculated on the accumulated timing differences at the year end
 based on tax rates and laws, enacted or substantially enacted as of the
 balance sheet date.
 
 (p) Provisions and Contingent Liabilities :
 
 Provisions are recognised in the accounts in respect of present
 probable obligations, the amount of which can be reliably estimated.
 
 Contingent Liabilities are disclosed in respect of possible obligations
 that arise from past events but their existence is confirmed by the
 occurrence or non-occurrence of one or more uncertain future events not
 wholly within the control of the Company.