1.1 Basis of preparation of financial statement
 
 I) The financial statements are prepared under historical cost
 convention, on a going concern basis and in accordance with the
 applicable Accounting Standard as specified in the Companies
 (Accounting Standards) Rules, 2006 (the Rules) and the relevant
 provisions of the Companies Act, 1956, to the extent applicable.
 
 ii) All expenses and income to the extent ascertainable with reasonable
 certainty are accounted for an accrual basis.
 
 iii) All assets and liabilities have been classified as current or
 non-current as per the Company''s normal operating cycle and other
 criteria set out in the revised schedule VI to the Companies Act,
 1956.Based on the nature of products and the time between the
 acquisition of assets for processing and their realisation in cash and
 cash equivalents, the Company has ascertained its operating cycle
 forthe purpose of current-noncurrent classification of assets and
 liabilities.
 
 1.2 Use of estimates
 
 The preparation of financial statements is in conformity with Generally
 Accepted Accounting principles (GAAP), which requires Management to
 make estimates and assumptions that affect the reported amounts of
 assets and liabilities and the disclosures of contingent liabilities on
 the date of financial statements, and reported amounts of revenue and
 expenses for that year. Actual results could differ from these
 estimates. Any revision to accounting estimates is recognised
 prospectively.
 
 1.3 Revenue Recognition!
 
 Sales are recognised when goods are supplied to customers and recorded
 net of sales tax / VAT.and sales return but includes excise duty.
 
 Export incentives under the Duty Entitlement Pass Book Scheme are
 accounted for in the year of export.
 
 Interest income is recognised on a time proportion basis
 
 1.4 Fixed assets.
 
 Tangible Assets : Fixed Asset are stated at cost including taxes,
 freight and other incidental expenses incurred in relation to
 acquisition & installation of the same, net of modvat.
 
 Intangible Assets : The company capitalizes software where it is
 reasonably estimated that the software has an enduring useful life.
 
 1.5 Depreciation
 
 The depreciation is provided on fixed assets on straight-line method at
 the rates specified in the Schedule XIV of the Companies Act, 1956 on
 pro-rata basis for additions/deductions.
 
 1.6 Investments
 
 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 in the opinion of the management.
 
 1.7 Inventories
 
 a.  Raw materials, Stores & Spares, and Packing Materials are valued at
 lower of cost or net realizable value under the FIFO method.
 
 b.  Stocks in Process are valued at lower of cost or net realizable
 value under the FIFO method. The cost is arrived at on full absorption
 basis as per Accounting Standard AS 2 -Valuation of inventories.
 
 c.  Finished Goods are valued at lower of cost or net realizable value,
 under the FIFO method. The cost is arrived at on full absorption basis
 as per Accounting Standard AS 2 - Valuation of inventories.
 
 1.8 Retirement benefit and leave wages 
 
 a.  Company''s contribution to Provident Fund, Pension Scheme &
 Employees'' State Insurance Corporation Funds v are charged to the
 Profit & Loss Account on an accrual basis.
 
 b.  Gratuity benefit payable at the time of retirement is charged to
 Profit & Loss Account on the basis of valuation certified by the
 management. The company does not have any gratuity fund whether
 internal or maintained by an outside agency.
 
 c.  Provision for accrued leave encashment is made on accrual basis and
 charged to Profit & Loss Account on the basis of valuation certified by
 the Management.
 
 1.9 Foreign currency transactions
 
 Foreign Currency Loan , Current Asset and Current Liabilities
 outstanding at the close of financial year are revalued at the
 contracted and/ or appropriate exchange rates at the close of the year.
 The gain or loss due to decrease/increase in rupee liability on account
 of fluctuations in the rate of exchange is adjusted to the cost of
 assets if it relates to acquisition of assets, and is charged to Profit
 & Loss Account in other cases.
 
 1.10 Taxation.
 
 a.  Income tax expense comprises current tax and deferred tax charge or
 credit (reflecting the tax effects of timing differences between
 accounting income and taxable income for the year).
 
 b.  Provision for income tax is made on the basis of estimated taxable
 income for the current accounting period in accordance with the Income
 Tax Act, 19 61.
 
 c.  The deferred tax charge or credit and the corresponding deferred
 tax liabilities or assets are recognised using the tax rates that have
 been enacted or substantively enacted by the balance sheet date.
 
 d.  Deferred tax assets are recognised only to the extent that there is
 virtual certainty that the assets can be realised in future. However,
 where there is un-absorbed depreciation or a carry-forward loss under
 taxation laws, deferred tax assets are recognised only if there is a
 virtual certainty of realisation of such assets. Deferred tax assets
 are reviewed at each balance sheet date and written down or up to
 reflect the amount that is reasonably / virtually certain to be
 realised.
 
 e.  Tax credit is recognised in respect of Minimum Alternate Tax (MAT)
 as per the provisions of Section 115JAA of the Income tax Act, 1961
 based on convincing evidence that the Company will pay normal income
 tax within the statutory time frame and is reviewed at each balance
 sheet date.
 
 1.11 Borrowing Costs.
 
 General and specific Borrowing costs (including exchange differences)
 directly attributable to the acquisition, construction and production
 of a qualifying asset are capitalized as paert of the cost of such
 asset up to date when such asset is ready for its intended use. Other
 borrowing costs are charged to the Profit & Loss Account.
 
 1.12 Leases
 
 Lease rentals in respect of operating leases are charged to Profit &
 Loss Account as an expense.
 
 1.13 Impairment of Asset
 
 The carrying amount of assets is reviewed at each Balance Sheet date
 for indication of any impairment based on internal / external factors.
 An asset is treated as impaired when the carrying cost of an asset
 exceeds its recoverable value and impairment loss is charged to the
 Profit & Loss account. The impairment of loss recognized in the prior
 accounting period is reversed if there has been a change in estimates
 of recoverable amount.
 
 1.14 Provisions, Contingent Liabilities and ContingentAssets
 
 a.  Provisions in respect of present obligations arising out of past
 events are made in the accounts when reliable estimates can be made of
 the amount of the obligation.
 
 b.  Contingent liabilities are disclosed by way of note to financial
 statements after careful evaluation by the management of the facts and
 legal aspects of the matter involved.
 
 c.  Contingent Assets are neither recognised nor disclosed in the
 financial statements.