(I) Basis of Preparation:
 
 The financial statements have been prepared to comply in all material
 respects with the Accounting Standards notified by Companies
 (Accounting Standards) Rules, 2006 (as amended) and the relevant
 provisions of the Companies Act, 1956. The financial statements have
 been prepared under the historical cost convention on an accrual basis,
 except in case of certain fixed assets for which revaluation is carried
 out. Except otherwise mentioned, the accounting policies have been
 consistently applied by the Company and are consistent with those used
 in the previous year.
 
 (II) Revenue Recognition:
 
 (a) Revenue from sale of goods and services rendered is recognised upon
 passage of title and rendering of services to the customers.
 
 (b) Insurance and other claims, to the extent considered recoverable,
 are accounted for in the year of claim. However, claims and refunds
 whose recovery cannot be ascertained with reasonable certainty, are
 accounted for on acceptance basis.
 
 (c) Interest is recognized on a time proportion basis taking into
 account the amount outstanding and rate applicable.
 
 (d) Dividends are recognized when the shareholders right to receive
 payment is established by the balance sheet date. Dividend from
 subsidiaries are recognized even if the same are declared after the
 balance sheet date but pertain to the period on or before the date of
 balance sheet as per the requirement of Schedule VI of the Companies
 Act, 1956.
 
 (III) Fixed Assets:
 
 (a) Fixed Assets are stated at cost of acquisition inclusive of duties
 (net of Cenvat and VAT), taxes, incidental expenses, erection /
 commissioning expenses and technical know-how fees etc. upto the date
 the asset is put to use, less accumulated depreciation and impairment
 losses, if any. In case of revaluation of fixed assets, the original
 cost as written up by the valuer is considered in the accounts and the
 differential amount is transferred to capital reserve.
 
 (b) Machinery spares which can be used only in connection with an item
 of fixed asset and whose use as per technical assessment is expected to
 be irregular, are capitalised and depreciated over the residual useful
 lives of the respective assets.
 
 (c) The carrying amounts of assets are reviewed at each balance sheet
 date to determine if there is any indication of impairment based on
 external / internal factors. An impairment loss is recognised wherever
 the carrying amount of an asset exceeds its recoverable amount which
 represents the greater of the net selling price and Value in use of
 the respective assets. The estimated future cash flows considered for
 determining the value in use are discounted to their present value at
 the weighted average cost of capital.
 
 (d) Assets awaiting disposal are valued at lower of written down value
 and net realisable value and disclosed separately
 
 (IV) Foreign Currency Transactions:
 
 (a) Initial Recognition:
 
 Foreign currency transactions are recorded in the reporting currency by
 applying to the foreign currency amount the exchange rate between the
 reporting currency and the foreign currency at the date of the
 transaction.
 
 (b) Conversion:
 
 Foreign currency monetary items are reported using the closing rate.
 Non-monetary items which are carried in terms of historical cost
 denominated in a foreign currency are reported using the exchange rate
 at the date of transaction; and non-monetary items which are carried at
 fair value or other similar valuation denominated in a foreign currency
 are reported using the exchange rates that existed when the values were
 determined.
 
 (c) Exchange Differences:
 
 Exchange differences arising on the settlement / conversion of monetary
 items are recognised as income or expenses in the year in which they
 arise.
 
 (d) Forward Exchange contracts not intended for trading or speculation
 purpose :
 
 The premium or discount arising at the inception of forward exchange
 contracts is amortised as expense or income over the life of respective
 contracts. Exchange differences on such contracts are recognised in the
 statement of profit and loss in the year in which the exchange rates
 change. Any profit or loss arising on cancellation or renewal of
 forward exchange contract is recognised as income or as expense for the
 year.
 
 (V) Depreciation:
 
 (a) Depreciation on Fixed Assets is provided on Straight Line Method at
 the rates arrived at on the basis of their useful lives, which are
 equivalent to the rates specified in Schedule XIV of the Companies Act,
 1956.
 
 (b) The classification of Plant and Machinery into continuous and
 non-continuous process is done as per technical certification and
 depreciation thereon is provided accordingly.
 
 (c) Technical Know-how fees included under the head Intangible Assets
 are amortised over the period of respective agreements / over the
 useful life of 10 years, whichever is lower. Other Intangible Assets
 are amortised over a period of three to five years on a straight line
 basis, being their estimated useful lives.
 
 (d) Depreciation includes the amount amortised in respect of leasehold
 land over the respective lease period.
 
 (e) Depreciation on revalued assets is provided at the rates specified
 under Section 205(2)(b) of the Companies Act, 1956 or at the rates
 based on their estimated useful life, whichever is higher.
 
 (f) Depreciation on fixed assets added / disposed off during the year,
 is provided on pro-rata basis with reference to the month of addition /
 disposal.
 
 (g) In case of impairment, if any, depreciation is provided on the
 revised carrying amount of the asset over its remaining useful life.
 
 (VI) Fixed Assets acquired under leases:
 
 (a) Finance Lease:
 
 Assets acquired under lease agreements which effectively transfer to
 the Company substantially all the risks and benefits incidental to
 ownership of the leased items, are capitalised at the lower of the fair
 value and present value of the minimum lease payments at the inception
 of the lease term and disclosed as leased assets. Lease payments are
 apportioned between the finance charges and reduction of the lease
 liability so as to achieve a constant rate of interest on the remaining
 balance of the liability. Finance charges are charged directly to
 Expenses account.
 
 Leased assets capitalised are depreciated over the shorter of the
 estimated useful life of the asset or the lease term.
 
 (b) Operating Lease:
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased assets, are classified as
 operating leases. Operating lease payments are recognised as an expense
 in the Profit and Loss Account on a straight line basis over the lease
 term.
 
 (VII) Intangibles :
 
 Technical know-how fees / acquired computer software and licenses are
 capitalized on the basis of costs incurred to bring the specific
 intangibles to its intended use.
 
 Research and Development Costs
 
 Research and Development costs are expensed, except for certain
 development expenses which are capitalized from the time commercial and
 technological feasibility criteria are met. Expenditure already charged
 to Profit and Loss Account is not restated.
 
 (VIII) Investments:
 
 (a) Investments that are readily realizable and intended to be held for
 not more than a year are classified as current investments. All other
 investments are classified as long-term investments.
 
 (b) Current Investments are stated at lower of cost or market rate on
 individual investment basis. Long Term Investments are considered at
 cost, unless there is other than temporary decline in value thereof,
 in which case, adequate provision is made against such diminution in
 the value of investments.
 
 (c) Investments in foreign companies are considered at the exchange
 rates prevailing on the date of their acquisition.
 
 (IX) Inventories:
 
 (a) Inventories are valued at lower of cost, computed on annual
 weighted / moving average basis, and net realisable value.
 
 (b) The closing stock of materials inter-transferred from one unit to
 another is valued at cost of the transferor unit or net realisable
 value whichever is lower.
 
 (c) Net realisable value is the selling price in the ordinary course of
 business, less costs of completion and costs necessary to make the
 sale.
 
 (d) Cost of finished goods and work in progress include direct
 materials, labour and an appropriate proportion of manufacturing
 overheads based on normal operating capacity. Cost of finished goods
 includes excise duty.
 
 (X) Excise Duty & Customs Duty:
 
 Excise Duty on Finished Goods stock lying at the factories is accounted
 for at the point of manufacture of goods and is accordingly considered
 for valuation of finished goods stock lying in the factories as on the
 Balance Sheet date. Similarly, Customs Duty on Imported Materials in
 transit / lying in Bonded Warehouse is accounted for at the time of
 import / bonding of materials.
 
 (XI) Cash & Cash Equivalents:
 
 Cash and Cash equivalents in the cash flow statement comprise Cash at
 bank and in hand and short term investments with an original maturity
 of three months or less.
 
 (XII) Derivative Instruments:
 
 As per ICAI announcement, derivative contracts, other than those
 covered under AS -11, are marked to market on a portfolio basis, and
 the net loss after considering the offsetting effects on the underlying
 hedge item, is charged to the income statement. Net gains are ignored.
 
 (XIII) Retirement & other employee benefits :
 
 (a) Defined Contribution plans:
 
 Companys contributions to Provident Fund and Superannuation Schemes
 are charged to Profit & Loss Account of the year when the contributions
 to the respective funds are due. The Company has no obligations other
 than the contributions payable to the respective trusts.
 
 (b) Defined Benefit plans:
 
 Gratuity liability and compensated leave liability are provided for
 based on actuarial valuation made at the end of each financial year.
 The actuarial valuation is done on Projected Unit Credit method.
 Actuarial gains and losses are recognised immediately in the statement
 of Profit & Loss Account as income or expense.
 
 (XIV) Borrowing Costs:
 
 Borrowing costs that are directly attributable to the acquisition or
 construction of qualifying assets are capitalised until the time all
 substantial activities necessary to prepare the qualifying assets for
 their intended use are complete. A qualifying asset is one that
 necessarily takes substantial period of time to get ready for its
 intended use. All other borrowing costs are charged to revenue.
 
 (XV) Provisions:
 
 A provision is recognised when an enterprise has a present obligation
 as a result of past event 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 made in terms of Accounting Standard 29 are not discounted
 to its present value and are determined based on the management
 estimates required to settle the obligation at the balance sheet date.
 These are reviewed at each balance sheet date and adjusted to reflect
 the current management estimates.
 
 (XVI) Taxation:
 
 (a) Tax expenses comprise of current & deferred tax. Current income tax
 is measured at the amount expected to be paid to the tax authorities in
 accordance with the Indian Income Tax Act, 1961.  Deferred Income taxes
 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.
 
 (b) Deferred tax is accounted for using the tax rates and laws that
 have been substantively enacted as of the Balance Sheet date. Deferred
 tax assets are recognised only to the extent that there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realised. If the Company
 has carry forward unabsorbed depreciation and tax losses, deferred tax
 assets are recognised only to the extent there is virtual certainty
 supported by convincing evidence that sufficient taxable income will be
 available against which such deferred tax assets can be realised.
 
 (c) At each balance sheet date, the Company re-assesses unrecognised
 deferred tax assets. It recognises unrecognised deferred tax assets to
 the extent that it has become reasonably certain or virtually certain,
 as the case may be, that sufficient future taxable income will be
 available against which such deferred tax assets can be realised.
 
 (XVII) Segment Reporting:
 
 (a) Identification of Segments:
 
 The Company has identified that its operating segments are the primary
 segments. The Companys operating businesses are organised and managed
 separately according to the nature of products, with each segment
 representing a strategic business unit that offers different products
 and serves different markets. The analysis of geographical segments is
 based on the areas in which the customers of the Company are located.
 
 (b) Allocation of Common Costs:
 
 Common allocable costs are allocated to each segment on case to case
 basis applying the ratio appropriate to each relevant case. Revenue and
 expenses which relate to the enterprise as a whole and are not
 allocable to segments on a reasonable basis, have been included under
 the head Unallocated-Common.
 
 The accounting policies adopted for segment reporting are in line with
 those of the Company.
 
 (XVIII) Product related Warranty Claims:
 
 Provision for product related warranty costs is based on the claims
 received upto the year end as well as the management estimates of
 further liability to be incurred in this regard during the warranty
 period, computed on the basis of past trend of such claims.
 
 (XIX) Contingencies:
 
 Liabilities which are material and whose future outcome cannot be
 ascertained with reasonable certainty, are treated as contingent and
 disclosed by way of Notes to the Accounts.
 
 (XX) Earnings per share:
 
 Basic earnings per share is calculated by dividing the net profit or
 loss for the year attributable to equity shareholders, by the weighted
 average number of equity shares outstanding during the year.
 
 For the purpose of calculating diluted earnings per share, the net
 profit or loss for the year attributable to equity shareholders and
 weighted average number of shares outstanding during the year are
 adjusted for the effects of all dilutive potential equity shares.
 
 (XXI) Use of Estimates
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles requires management to make estimates
 and assumptions that affect the reported amounts of assets and
 liabilities and disclosure of contingent liabilities at the date of the
 financial statements and the results of operations during the reporting
 year. Although these estimates are based upon managements best
 knowledge of current events and actions, actual results could differ
 from these estimates.