a.  Accounting Convention:
 
 The financial statements have been prepared under the historical cost
 convention in accordance with the generally accepted accounting
 principles in India, applicable Accounting Standards as prescribed by
 Companies (Accounting Standards) Rule, 2006 issued by Ministry of
 Corporate Affairs and the provisions of the Companies Act,1956, except
 for certain fixed assets which have been revalued.
 
 All items of income and expenditure have been recognised on accrual
 basis. The accounting policies applied by the Company are consistent
 with those used in the previous years.
 
 b.  Use of Estimates:
 
 The preparation of financial statements require estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities on the date of the financial statements and the reported
 amount of revenues and expenses during the reporting period. Difference
 between the actual results and estimates are recognised in the period
 in which the results are known/materialised.
 
 c.  Revenue Recognition:
 
 Sales revenue is recognised on transfer of significant risk and rewards
 of the ownership of the goods to the buyer and stated at net of trade
 discounts and rebates. Other income is recognised on accrual basis.
 Dividend income on investments is accounted for when the right to
 receive the payment is established.
 
 Sale of Certified Emission Reductions (CERs) is recognised as Income on
 the delivery of the CERs to the buyer(s).
 
 d.  Fixed Assets:
 
 (i) Fixed Assets, including modernisation expenses incurred are stated
 at cost of acquisition, construction and improvement made, which is
 inclusive of freight, duties, taxes, incidental expenses, interest &
 fund raising cost and other pre-operative expenses apportioned and also
 includes revaluation amount.
 
 (ii) Capital Work-in-Progress is stated at cost including interest and
 related expenses incurred during construction or pre-operative period.
 
 (iii) Intangible Assets are stated at cost of acquisition less
 accumulated amortization.
 
 e.  Depreciation/Amortisation :
 
 (i) Depreciation has been calculated on Straight Line Method (SLM) on
 the assets acquired/installed upto 30th June, 1986 at the rates
 prevailing at the time of acquisition or installation of the said
 assets. On the assets acquired thereafter upto 31st March, 1993 the
 specified period was recomputed according to the revised rates of
 depreciation as prescribed in Schedule XIV to the Companies Act, 1956
 and the amount of depreciation on these assets has been calculated by
 allocating unamortised value over the remaining part of the recomputed
 specified period. Depreciation on subsequent additions has been
 calculated at SLM as per the rates prescribed in Schedule XIV to the
 Companies Act, 1956.
 
 (ii) Lease hold land is being amortised over the period and/or
 remaining period of the lease.
 
 (iii) Depreciation on revalued amount of Fixed Assets has been
 calculated on pro-rata basis to their residual life and charged to
 Profit & Loss Account in absence of Revaluation Reserve.
 
 (iv) Intangible Assets consisting of Computer Software are amortised
 over a period of three years using Straight Line Method.
 
 f.  Foreign Currency Transaction :
 
 (i) Year end balance of foreign currency transactions is translated at
 the year end rates and the corresponding effect is given in the
 accounts excepting those transactions covered by the fixed forward
 contract for conversion of foreign currency loan in rupee loan which
 are stated at contracted amount. Transactions completed during the year
 are adjusted on actual basis.
 
 (ii) In respect of transactions covered under forward foreign exchange
 contracts, the difference between the forward rate and exchange rate at
 the inception of contract is recognised as income or expense over the
 life of the contract.
 
 (iii) Effects arising of interest swap contracts are being adjusted on
 the date of settlement. Year end liabilities/assets are recognised at
 the relevant rate prevailing on that date.
 
 g.  Inventories:
 
 Inventories are valued as under:-
 
 Stores & Spare Parts etc.# At Cost or net realisable value whichever is
 lower Raw Materials # At Cost or net realisable value whichever is
 lower Finished Goods At Cost or net realisable value, whichever is
 lower and in case of products, where cost cannot be ascertained, at net
 realisable value.  Work-in-Process At Raw Material Cost and/or at cost
 or net realisable value, whichever is lower
 
 # The Cost has been arrived at using Weighted Average method.
 
 h.  Investments:
 
 Long term Investments are stated at cost less provision, if any, for
 diminution, which is considered as permanent in nature. Current
 Investments are stated at cost or fair value whichever is lower
 
 i.  Employee Benefits:
 
 Employee benefits of short-term nature are recognised as expenses as
 and when it accrues. Long-term employee benefits (e.g. long- service
 leave) and post employment benefits (e.g., gratuity), both unfunded,
 are recognised on expenses based on actuarial valuation at year end
 using projected unit credit method. Actuarial gain and losses are
 recognised immediately in the profit and loss account.
 
 j. Taxation:
 
 (i) Provision for current Income Tax is made in accordance with the
 Income Tax Act,1961. Deferred Tax is measured in accordance with
 Accounting Standard 22- ''Accounting for Taxes on Income'', as specified
 in the Companies (Accounting Standard) Rule, 2006 issued by Ministry of
 Corporate Affairs. The deferred tax charge or credit is recognised,
 subject to consideration of prudence, using substantively enacted tax
 rates, for timing differences between book and tax profits that
 originate in one period and are capable of reversal in one or more
 subsequent periods.
 
 (ii) Minimum Alternative Tax (MAT) credit is recognised as an asset
 only when and to the extent there is convincing evidence that the
 Company will pay normal Income Tax during the specified period. In the
 year in which minimum alternative tax credit becomes eligible to be
 recognised as an asset in accordance with the recommendation contained
 in guidance note issued by The Institute of Chartered Accountants of
 India, the said asset is created by way of credit to Profit & Loss
 Account. The Company reviews the same at each Balance Sheet date and
 writes down the carrying amount of MAT entitlement to the extent there
 is no longer convincing evidence to the effect that the Company will
 pay normal Income Tax during the specified period.
 
 k. Borrowing Cost:
 
 Interest and other costs in connection with the borrowing of the funds
 to the extent related/attributed to the acquisition/construction of
 qualifying fixed assets are capitalised upto the date when such assets
 are ready for its intended use and other borrowing costs are charged to
 Profit & Loss Account.
 
 Premium on redemption of Bonds/Debentures to the extent they are
 related/attributed to acquisition/ construction of qualifying fixed
 assets are capitalized upto the date when such assets are ready for its
 intended use. Thereafter, Premium on redemption of Bonds/Debentures,
 net of tax impact, are adjusted against Securities Premium Account.
 
 l. Impairment:
 
 Impairment loss is recognised wherever the carrying amount of an assets
 is in excess of its recoverable amount and the same is recognised as an
 expense in the statement of Profit and Loss and carrying amount of the
 assets is reduced to its recoverable amount. Reversal of impairment
 losses recognised in prior years is recorded when there is an
 indication that the impairment losses recognised for the assets no
 longer exist or have decreased.
 
 m. Commodity hedging contracts :
 
 The realized gain or loss in respect of commodity hedging contracts,
 the pricing period of which has expired during the year are recognized
 in Profit and Loss Account. However, in respect of contracts, the
 pricing period of which extends beyond the Balance Sheet date,
 provisions for net loss on mark to market basis is made.
 
 n. Provisions, Contingent Liabilities and Contingent Assets:
 
 Provisions involving substantial degree of estimation in measurement
 are recognized when there is a present obligation as a result of past
 events and it is probable that there will be an outflow of resources.
 Contingent liabilities are not recognized but are disclosed in the
 Notes on Accounts.  Contingent assets are neither recognized nor
 disclosed in the financial statements.