1) Convention
 
 The financial statements have been prepared in accordance with
 applicable Accounting Standards in India and in accordance with the
 relevant provisions of the Companies Act, 1956. A summary of important
 accounting policies which have been applied consistently is set out
 below.
 
 2) Basis of Accounting
 
 The financial statements have been prepared in accordance with
 historical cost convention. All income and expenses, unless
 specifically stated otherwise, have been accounted for on accrual
 basis.
 
 3) Sales
 
 Sales are inclusive of sales tax/VAT and net of trade discount.
 
 4) Government Grants
 
 i) Government Grants related to specific assets are adjusted with value
 of fixed assets.
 
 ii) Government Grants in the nature of Promoters'' Contribution towards
 fixed assets are credited to capital reserve.  iii) Government Grant
 related to revenue items are adjusted with the related
 expenditure/taken in income.
 
 5) Fixed Assets & Depreciation/Amortisation
 
 a) Fixed assets are stated at cost less accumulated depreciation and
 accumulated impairment loss, if any.
 
 b) Depreciation on all assets, other than vehicles, is provided on the
 Straight Line Method, and on vehicles on the Written Down Value
 Method in the manner and at the rates specified in Schedule XIV to the
 Companies Act, 1956.
 
 c) Depreciation on residential building and ITI house of Sungma Tea
 Estate as on 01.04.1997 has been charged @ 4.75% & 19% respectively as
 per the residual useful life determined by the valuer.
 
 d) Items of machinery spares to be used in connection with an item of
 fixed asset are amortized over the useful life of the asset.
 
 e) Leasehold Land (Others) is amortised over the period of lease.
 
 6) Impairment of Assets
 
 Impairment of Assets are assessed at each Balance Sheet date for each
 cash generating unit and if any indicators of impairment exists, the
 same is assessed and provided for in accordance with the Accounting
 Standard 28. A previously recognized impairement loss is periodically
 assessed.
 
 7) Leases
 
 For assets acquired under operating lease, rental payable are charged
 to Profit & Loss Account. Assets acquired under finance lease are
 capitalized at lower of the fair value and the present value of minimum
 lease payment. Lease income from operating leases is recognized in the
 Profit & Loss account over the period of lease.
 
 8) Investments
 
 Long Term Investments are stated at cost. Provision for diminution of
 investment is made to recognize a decline, other than temporary, in the
 value of the investments. Current Investments are stated at cost or
 fair value which ever is lower.
 
 22. Statement of Accounting Policies (Cont''d...) 9) Inventories
 
 Inventories are valued at cost or net realisable value whichever is
 lower. Cost is determined on weighted average/FIFO basis. Cost
 comprises expenditure incurred in the normal course of business in
 bringing such inventories to their location and condition and includes
 appropriate overheads. Provision is made for obsolete and slow moving
 stocks, wherever necessary.  10) Employment Benefits
 
 i) Short term Employees Benefits:
 
 The undiscounted amount of short term employee benefit expected to be
 paid in exchange for the services rendered by employee is recognized
 during the period when the employee render the service. This benefit
 includes salary, wages, short term compensatory absences and bonus.
 
 ii) Long Term Employee Benefits:
 
 a) Defined Contribution Scheme: This benefit includes contribution to
 Superannuation Scheme, ESIC (Employees'' State Insurance Corporation)
 and Provident Fund Schemes. The contribution is recognized during the
 period in which the employee renders service.
 
 b) Defined Benefit Scheme: For defined benefit scheme the cost of
 providing benefit is determined using the projected unit credit method
 with actuarial valuation being carried out at each balance sheet date.
 The retirement benefit obligation recognized in the Balance Sheet
 represents value of defined benefit obligation as reduced by the fair
 value of planned assets. Actuarial gains and losses are recognized in
 full during the period in which they occur.
 
 c) Other Long Term Benefits: Long term Compensated absence is provided
 for on the basis of an actuarial valuation, using the Projected Unit
 Credit Method as at the date of Balance Sheet.
 
 11) Borrowing Costs
 
 Borrowing costs that are directly attributable to the acquisition,
 construction or production of a qualifying asset are capitalized as
 part of the cost until the asset is ready for its intended use. A
 qualifying asset is an asset that necessarily requires a substantial
 period of time to get ready for its intended use. Other borrowing costs
 are recognised as an expense in the period in which they are incurred.
 
 12) Foreign Currency Transactions
 
 Transactions in foreign currencies are recorded at exchange rates
 prevailing on the date of the transaction.  Monetary items denominated
 in foreign currency are restated at the exchange rate prevailing on the
 Balance Sheet date. Foreign currency non-monetary items carried in
 terms of historical cost are reported using the exchange rate at the
 date of the transactions. Exchange differences arising on settlement of
 transactions and/or restatements are dealt with in the Profit & Loss
 Account.
 
 13) Derivative Transactions
 
 The Company uses derivative financial instruments such as forward
 exchange contracts, currency swap etc. to hedge its risks associated
 with foreign currency fluctuations relating to the underlying
 transactions, highly probable forecast transactions and firm
 commitments. In respect of Forwards Exchange Contracts with underlying
 transactions, the premium or discount arising at the inception of such
 contract is amortised as expense or income over the life of contract.
 
 Other Derivative contracts outstanding at the Balance Sheet date are
 marked to market and resulting loss, if any, is provided for in the
 financial statement. Any profit or losses arising on cancellation of
 derivate instruments are recognized as income or expense for the
 period.
 
 14) Taxes on Income
 
 Current tax is determined on the basis of the amount of tax payable for
 the year under Income Tax Act, and Agriculture Income Tax of the
 respective states. Deferred tax is calculated at the applicable tax
 rate and is recognized on timing differences between taxable income and
 accounting income that originate in one period and are capable of
 reversal in one or more subsequent period. Deferred tax assets subject
 to consideration of prudence, are recognized and carried forward only
 to the extent that there is virtual certainty that sufficient future
 taxable income will be available against which such deferred tax assets
 can be realized. Tax Credit for Minimum Alternate Tax (MAT) is
 recognised when there is virtual certainty of its realisability against
 future tax liability.
 
 15) Provisions, Contingent Liabilities & Contingent Assets
 
 Provisions are recognized in respect of present obligations arising out
 of past events where there are reliable estimates of the probable
 outflow of resources. Contingent liabilities are the possible
 obligation of the past events, the existence of which will be confirmed
 only by the occurrence or non-occurrence of a future event. These are
 not provided for but are disclosed by way of Notes on Accounts.
 Contingent Assets are not provided for or disclosed.