1.1 Basis of accounting and preparation of financial statements
 
 The financial statements of the Company have been prepared in
 accordance with the Generally Accepted.
 
 1.2 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 / materialise.
 
 1.3 Inventories
 
 Inventories are valued at cost. Cost includes all charges in bringing
 the goods to the point of sale.
 
 1.4 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.
 
 1.5 Revenue recognition Sale of goods/services:
 
 Sales comprise sale of goods net of trade discount and sales tax.
 Excise duty collected has been included in sales value.
 
 1.6 Other income
 
 Interest income is accounted on accrual basis. Dividend income is
 accounted for when the right to receive it is established.
 
 1.7 Tangible fixed assets
 
 Fixed assets are carried at cost less accumulated depreciation and
 impairment losses, if any. The cost of fixed assets includes interest
 on borrowings attributable to acquisition of qualifying fixed assets up
 to 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 overthe
 remaining useful life of such assets. Machineryspares which can be used
 only in connection with an item of fixed asset and whose use is
 expected to be irregular are capitalised and depreciated over the
 useful life of the principal item of the relevant 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.
 
 1.8 Employee benefits
 
 Employee benefits include provident fund, superannuation fund, gratuity
 fund,. Liability of Gratuity has been provided as actually determined
 as at the year end and contribution is being made to LIC of India under
 group gratuity fund.  However, leave encashment on separation has been
 accounted for on payment basis.
 
 1.9 Earnings per share
 
 Basic earnings per share is computed by dividing the profit / (loss)
 after tax (including the post taxeffect of extraordinary items, if any)
 by the weighted average number of equity shares outstanding during the
 year.
 
 1.10 Taxes on income
 
 Current tax is the amount of tax payable on the taxable income for the
 year as determined in accordance with the provisions of the Income Tax
 Act, 1961.
 
 1.11 Treatment of Prior Period and Extra Ordinary Items
 
 Any material (other than those arising out of over/ under estimation in
 earlier years) arising as a result of error or omission in preparation
 of earlier years financial statements are separately disclosed.
 
 1.12 Provisions and Contingent liabilities
 
 A provision is made based on reliable estimate when it is probable that
 an outflow or resources embodying economic benefits will be required to
 settle an obligation. Contingent liabilities, if material, are
 disclosed by way of notes to accounts.
 
 1.13 Excise Duty
 
 Excise duty payable on finished goods held in plant is neither included
 in expenditure nor valued in stocks, but it is accounted for on
 clearance of goods from plant. This accounting treatment has no impact
 on profits.
 
 1.14 Research and Development
 
 Research and Development costs other than cost of fixed assets
 acquired/ developed, or charged as expenditure in the year in which
 they are incurred