1.  Method of Accounting
 
 The Company normally follows the mercantile system of accounting and
 recognises income and expenditure on accrual basis.
 
 2.  Fixed Assets and Depreciation
 
 A.  Fixed Assets are stated at cost.
 
 B.  Depreciation has been provided on fixed assets on straight line
 method at the rates prescribed under schedule XIV of the Companies Act
 1956 on Pro-rata basis.
 
 3.  Investments
 
 Unquoted investments are valued at cost.
 
 4.  Inventories
 
 A.  Raw materials are valued at cost or market price whichever is low.
 
 B.  Stores and consumables are valued at market price.
 
 C.  Finished goods are valued at lower of cost or net realisable value.
 
 The value of inventories has been brought down to its realisable value
 which is lower than its cost during the year under review.
 
 7.  Sales
 
 There are no sales since the company has not carried out any activities
 during the year.
 
 8.  All Secured Loans have been settled during the year as per the one
 time settlement agreement with the Banker.
 
 9.  There are no contingent liabilities during the year and hence the
 question of disclosure in notes to the financial statements does not
 arise.
 
 10.  Some debtors have been written off and some creditors have been
 written back as the transactions with those parties are not expected to
 arise in the future. The balance is subject to confirmation.
 
 11.  Taxation :
 
 Deferred Tax Asset is not recognised for the year on consideration of
 prudence as set out in Accounting Standard 22 on  Accounting for Taxes
 on Income* issued by the Institute of Chartered Accountants of India.