1.  The financial statements have been prepared under historical cost
 convention (except for certain fixed assets which were revalued) on
 accrual basis in compliance with applicable Accounting Standards
 notified by the Companies (Accounting Standards) Rules, 2006 and
 relevant provisions of the Companies Act, 1956.
 
 2.  Fixed assets are stated at cost adjusted by revaluation of certain
 assets.
 
 3.  Expenditure during construction / erection period is included under
 capital work-in-progress and is allocated to the respective fixed
 assets on completion of construction / erection.
 
 4.  a) Depreciation on fixed assets has been provided using Straight
 Line Method at rates and manner prescribed under Schedule XIV of 
 the Companies Act, 1956. Continuous Process Plants as defined in 
 Schedule XIV have been considered on technical evaluation.
 
 b) Leasehold Land is being amortised over the lease period.
 
 c) Depreciation on the increased amount of assets due to revaluation is
 computed on the basis of residual life of the assets as estimated by
 the valuer on Straight Line Method.
 
 5.  Foreign currency transactions are recorded at exchange rates
 prevailing on the date of transaction. Monetary assets and liabilities
 in foreign currencies as at the Balance Sheet date are translated at
 exchange rate prevailing at the year end. Premium in respect of forward
 contracts is recognised over the life of contract. Exchange differences
 arising on actual payments / realizations and year end translations
 including on forward contracts are dealt with in Profit and Loss
 Account. Non Monetary Foreign Currency items are stated at cost.
 
 6.  Long Term Investments are stated at cost. Provision for diminution
 in the value of long term Investments is made only if, such a decline
 is other than temporary. The Current Investments are stated at lower of
 cost or quoted / fair value computed category-wise.
 
 7.  Inventories are valued at lower of cost and net realisable value.
 The cost is computed on weighted average basis. Finished Goods and
 Process Stock include cost of conversion and other costs incurred in
 bringing the inventories to their present location and condition.
 
 8.  Revenue Expenditure on Research and Development is charged to
 Profit & Loss Account and Capital Expenditure is added to Fixed Assets.
 
 9.  Borrowing Cost is charged to Profit & Loss Account except cost of
 borrowings for acquisition of qualifying assets which is capitalised
 till the date of commercial use of the asset.
 
 10.  The carrying amount of assets are reviewed at each Balance Sheet
 date to assess impairment, if any based on internal / external factors.
 An asset is treated as impaired when the carrying cost of asset exceeds
 its recoverable value being higher of value in use and net selling
 price. An impairment loss is recognised as an expense in the Profit &
 Loss Account in the year in which an asset is identified as impaired.
 The impairment loss recognised in prior accounting period is reversed,
 if there has been an improvement in recoverable amount.
 
 11.  Employee Benefits:
 
 (a) Defined-contribution plans:
 
 Contributions to the Employees Regional Provident Fund, Superannuation
 fund, Employees Pension Scheme and Employees State Insurance are
 recognised as defined contribution plan and charged as expenses during
 the period in which the employees perform the services.
 
 (b) Defined-benefit plans:
 
 Retirement benefits in the form of Gratuity and Leave Encashment are
 considered as defined benefit plan and determined on actuarial
 valuation using the Projected Unit Credit Method at the Balance Sheet
 date.  Actuarial Gains and Losses are recognised immediately in the
 Profit & Loss Account.
 
 The Provident Fund Contribution other than contribution to Employees
 Regional Provident Fund, is made to trust administered by the trustees.
 The interest rate to the members of the trust shall not be lower than
 the statutory rate declared by the Central Government under Employees
 Provident Fund and Miscellaneous Provision Act, 1952. The Employer
 shall make good deficiency, if any.
 
 (c ) Short term employee benefits:
 
 Short term benefits are charged off at the undiscounted amount in the
 year in which the related service is rendered.
 
 12.  Export incentives and other benefits are recognised in the Profit
 & Loss Account. Project subsidy is credited to Capital Reserve.
 
 13.  Current Tax is the amount of tax payable on the estimated taxable
 income for the current year as per the provisions of Income Tax Act,
 1961. Deferred Tax is recognised for timing differences. However,
 Deferred Tax Asset is recognised on the basis of reasonable / virtual
 certainty that sufficient future taxable income will be available
 against which the same can be realised.
 
 14.  Intangible Assets are being recognised if the future economic
 benefits attributable to the assets are expected to flow to the company
 and cost of the asset can be measured reliably. The same are being
 amortised over the expected duration of benefits.