(I) Basis of Accounting
 
 The financial statements are prepared under historical cost convention
 on an accrual basis and are in accordance with the requirements of the
 Companies Act, 1956, and comply with the Accounting Standards referred
 to in sub-section (3C) of Section 211 of the said Act.
 
 (II) Use of Estimates
 
 The preparation of financial statements in conformity with Generally
 Accepted Accounting Principles (GAAP) in India requires management to
 make estimates and assumptions that affect the reported amount of
 assets and liabilities and the disclosure of contingent liabilities on
 the date of financial statements and the reported amount of revenue and
 expenses during the reporting period. Actual results could defer from
 those estimates.  Any revision to accounting estimates is recognised
 prospectively in current and future period.
 
 (III) Classification of Assets and Liabilities
 
 The Revised Schedule VI to the Companies Act, 1956 requires assets and
 liabilities to be classified as either Current or Non-current.
 
 (a) An asset shall be classified as current when it satisfies any of
 the following criteria:
 
 (i) It is expected to be realized in, or is intended for sale or
 consumption in, the Company''s normal operating cycle;
 
 (ii) It is held primarily for the purpose of being traded;
 
 (iii) It is expected to be realized within twelve months after the
 reporting date; or
 
 (iv) It is cash or cash equivalent unless it is restricted from being
 exchanged or used to settle a liability for at least twelve months
 after the reporting date.
 
 (b) All assets other than current assets shall be classified as
 non-current.
 
 (c) A liability shall be classified as current when it satisfies any of
 the following criteria:
 
 (i) It is expected to be settled in the company''s normal operating
 cycle;
 
 (ii) It is held primarily for the purpose of being traded;
 
 (iii) It is due to be settled within twelve months after the reporting
 date; or
 
 (iv) The company does not have an unconditional right to defer
 settlement of the liability for at least twelve months after the
 reporting date.
 
 (d) All liabilities other than current liabilities shall be classified
 as non-current.
 
 (IV) Operating Cycle
 
 An operating cycle is the time between the acquisition of assets for
 processing and their realization in cash or cash equivalents.
 
 (V) Previous Year Figures
 
 The financial statements for the year ended 31st March, 2012 have been
 presented as per the Revised Schedule VI to the Companies Act, 1956.
 Accordingly, the previous year''s figures have also been reclassified to
 conform to this year''s classification.
 
 (B) Summary of Significant Accounting Policies
 
 (I) Fixed Assets
 
 (a) Fixed assets are stated at their original cost of acquisition and
 installation, less accumulated depreciation, amortisation and
 impairment losses, if any. Cost comprises of the purchase price and any
 other directly attributable cost of bringing the asset to its working
 condition for its intended use.
 
 (b) Borrowing costs that are directly attributable to the acquisition
 of qualifying assets are capitalised for the period until the asset is
 ready for its intended use. A qualifying asset is an asset that
 necessarily takes 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.
 
 (I) Fixed Assets (contd.)
 
 (c) Depreciation is provided on the written down value method at the
 rates prescribed in Schedule XIV to the Companies Act, 1956. The rates
 of depreciation prescribed in Schedule XIV to the Companies Act, 1956
 are considered as the minimum rates. If the management''s estimate of
 the useful life of a fixed asset at the time of acquisition of the
 asset or of the remaining useful life on a subsequent review is shorter
 than that envisaged in the aforesaid schedule, depreciation is provided
 at the higher rate based on the mangement''s estimates of the useful
 life / remaining useful life. Pursuant to this policy, in respect of
 colour dispensers the rate of depreciation applied is 45 per cent,
 which management considers as being representative of the useful
 economic life of such assets. Assets costing less than Rs 5,000 each are
 fully depreciated in the year of capitalisation.
 
 (d) Leasehold lands are amortised over the primary period of lease.
 
 (e) Purchase cost and user licence fees for major software are
 amortised over a period of three years.
 
 (f) Impairment loss is provided to the extent the carrying amount of
 assets exceed their recoverable amount.  The carrying amount of assets
 are reviewed at each balance sheet date if there is any indication of
 impairment based on internal / external factors. Recoverable amount is
 the higher of an asset''s net selling price and its value in use. Value
 in use is the present value of estimated future cash flows expected to
 arise from the continuing use of an asset and from its disposal at the
 end of its useful life. Net selling price is the amount obtainable from
 the sale of an asset in an arm''s length transaction between
 knowledgeable, willing parties less the cost of disposal. If at the
 Balance Sheet date there is an indication that the previously assessed
 impairment loss no longer exist, the recoverable amount is reassessed
 and the asset is reflected at recoverable amount subject to maximum of
 depreciable historical cost.
 
 (g) Capital expenditure on Research and Development is treated in the
 same way as expenditure on fixed assets. Revenue expenditure on
 Research and Development is charged to the Statement of Profit and Loss
 in the year in which it is incurred.
 
 (II) Investments
 
 (a) Long-term investments are stated at cost. A provision for
 diminution is made to recognise a decline, other than temporary, in the
 value of long-term investments. The determination for diminution is
 done separately for each individual investment.
 
 (b) Current investments, consist of investments in mutual funds, are
 stated at lower of cost and fair value where net asset value declared
 by the respective funds is considered as fair value.
 
 (c) Profit or loss on sale of investments is determined on the basis of
 weighted average carrying amount of investments disposed off.
 
 (III) Inventories
 
 (a) Stores and spare parts are valued at cost less amounts written
 down.
 
 (b) Inventories other than stores and spare parts are valued at the
 lower of cost and net realisable value after making such provisions as
 required on account of damaged, unserviceable, inert and obsolete
 stocks. The comparison of the cost and net realisable value is made on
 item by item basis.
 
 (c) Cost has been arrived at on the basis of weighted average method.
 
 (d) The net realisable value of finished goods and stock-in-trade is
 determined with reference to the selling prices of related finished
 goods. Raw materials and other supplies held for use in production of
 inventories are not written down below cost except in cases where
 material prices have declined and it is estimated that the cost of
 finished products will exceed their net realisable value. In such
 cases, the materials are valued at replacement cost.
 
 (IV) Provisions and Contingent Liabilities
 
 (a) A provision is recognised when an enterprise has a present
 obligation as a result of past event and it is probable that an outflow
 of resources will be required to settle the obligation, in respect of
 which a reliable estimate can be made. Provisions are not discounted to
 their present values and are determined based on management estimate
 required to settle the obligation at the Balance Sheet date. These are
 reviewed at each Balance Sheet date and adjusted to reflect the current
 management estimates.
 
 (IV) Provisions and Contingent Liabilities (contd.)
 
 (b) Contingent liabilities are disclosed in respect of possible
 obligations that have arisen from past events and the existance of
 which will be confirmed only by the occurance or non-occurance of
 future events not wholly within the control of the Company.
 
 (c) When there is an obligation in respect of which the likelyhood of
 outflow of resources is remote, no provision or disclosure is made.
 
 (V) Revenue Recognition
 
 (a) Sales are recognised in accordance with Accounting Standard (AS) 9
 — Revenue viz. when the seller has transferred to the buyer, the
 property in the goods, for a price, or significant risk and rewards of
 ownership have been transferred to the buyer.
 
 (b) Sales are inclusive of excise duty and are net of trade discount
 and product rebate.
 
 (c) Dividend income is accounted when the right to receive payment is
 established and known.
 
 (d) Interest income is recognised on the time proportion basis.
 
 (VI) Employee Benefits
 
 (a) Short Term Employee Benefits:
 
 Short term employee benefits are recognised as an expense at the
 undiscounted amount in the Statement of Profit and Loss of the year in
 which the related service is rendered.
 
 (b) Post-employment Benefits:
 
 (i) Provident and Family Pension Fund
 
 The eligible employees of the Company are entitled to receive post
 employment benefits in respect of provident and family pension fund, in
 which both the employees and the Company make monthly contributions at
 a specified percentage of the employees'' eligible salary (currently 12%
 of employees'' eligible salary). The contributions are made to the
 provident fund managed by the trust set up by the Company or to the
 Regional Provident Fund Commissioner (RPFC) which are charged to the
 Statement of Profit and Loss as incurred. In respect of contribution to
 RPFC, the Company has no further obligations beyond making the
 contribution, and hence, such employee benefit plan is classified as
 Defined Contribution Plan. In respect of contribution to the trust set
 up by the Company, since the Company is obligated to meet interest
 shortfall, if any, with respect to covered employees, such employee
 benefit plan is classified as Defined Benefit Plan in accordance with
 the Guidance on implementing Accounting Standard (AS) 15 (Revised) on
 Employee Benefits.
 
 (ii) Superannuation
 
 The eligible employees of the Company are entitled to receive post
 employment benefits in respect of superannuation fund in which the
 Company makes annual contribution at a specified percentage of the
 employees'' eligible salary (currently 15% of employees'' eligible
 salary). The contributions are made to the Life Insurance Corporation
 of India (LIC). Superannuation is classified as Defined Contribution
 Plan as the Company has no further obligations beyond making the
 contribution. The Company''s contribution is charged to the Statement of
 Profit and Loss as incurred.
 
 (iii) Gratuity
 
 The Company has an obligation towards gratuity, a defined benefit
 retirement plan covering eligible employees. The plan provides a lump
 sum payment to vested employees at retirement, death while in
 employment or on termination of employment of an amount equivalent to
 15 days salary payable for each completed year of service or part
 thereof in excess of six months. Vesting occurs upon completion of five
 years of service. The Company has obtained insurance policies with the
 Life Insurance Corporation of India (LIC) and makes an annual
 contribution to LIC for amounts notified by LIC. The Company accounts
 for gratuity benefits payable in future based on an independent
 external actuarial valuation carried out at the end of the year.
 Actuarial gains and losses are recognised in the Statement of Profit
 and Loss.
 
 (VI) Employee Benefits (contd.)
 
 (c) Other Long-Term Employee Benefits — Compensated Absences:
 
 The Company provides for encashment of leave or leave with pay subject
 to certain rules. The employees are entitled to accumulate leave
 subject to certain limits for future encashment / availment. The
 Company makes provision for compensated absences based on an
 independent actuarial valuation carried out at the end of the year.
 Actuarial gains and losses are recognised in the Statement of Profit
 and Loss.
 
 (VII) Foreign Currency Transactions
 
 (a) Transactions in foreign currencies are recorded at the exchange
 rate that approximates the actual rate at the date of the transaction.
 In respect of monetary assets and liabilities denominated in foreign
 currencies, exchange differences arising out of settlement are
 recognised in the Statement of Profit and Loss. Monetary assets and
 liabilities denominated in foreign currencies as at the Balance Sheet
 date are translated at the exchange rates on that date, the resultant
 exchange differences are recognised in the Statement of Profit and
 Loss.
 
 (b) Premiums or discounts arising at the inception of the forward
 foreign exchange contracts, other than contracts to hedge a firm
 commitment or a highly probable forecast transaction, are amortised and
 recognised in the Statement of Profit and Loss over the period of the
 contract. Such forward foreign exchange contract outstanding as at the
 Balance Sheet date are converted at the exchange rates prevailing on
 that date.  Exchange differences are recognised in the Statement of
 Profit and Loss.
 
 (VIII) Accounting for Derivatives
 
 Forward contracts to which Accounting Standard (AS) 11 — ''The Effects
 of Changes in Foreign Exchange Rates'' is applicable, the accounting
 policy as stated in Note 1 (B) (VII)(b) is followed. In respect of
 other derivative contracts including forward foreign exchange contracts
 to which the aforesaid accounting standard is not applicable are marked
 to market at the rate on the Balance Sheet date. The resultant exchange
 losses are recognised in the Statement of Profit and Loss. Gains
 arising on the same are not recognised, until realised, on grounds of
 prudence.
 
 (IX) Taxation
 
 Tax expense comprises current and deferred tax. Current tax is measured
 at the amount expected to be paid to the tax authorities in accordance
 with the Income-tax Act, 1961. Deferred tax reflects the impact of
 current year timing differences between taxable income and accounting
 income for the year and reversal of timing differences of earlier
 years. Deferred tax is measured based on the tax rate and tax laws
 enacted or substantially enacted as at the balance sheet date. Deferred
 tax assets are recognised only to the extent that there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realised in future;
 however, where there is unabsorbed depreciation or carry forward of
 losses, deffered tax assets are recognised only if there is virtual
 certainty of realisation of such assets. Deferred tax assets are
 reviewed as at each Balance Sheet date and written down or written up
 to reflect the amount that is reasonably / virtually certain (as the
 case may be) to be realised.
 
 (X) Leases
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased assets are classified as
 operating leases. Operating lease payments / receipts are recognised as
 an expense / income in the Statement of Profit and Loss on a
 straight-line basis over the lease term.
 
 (XI) Cash and Cash Equivalent
 
 Cash comprises cash on hand and demand deposits with banks. Cash
 equivalents are short term (with an original maturity of three months
 or less from the date of acquisition), highly liquid investments that
 are readily convertible into known amounts of cash and which are
 subject to an insignificant risk of changes in value.
 
 * With restructuring of the production facilities, the timing of the
 outflow of provision Rs 255.36 Million (2010-2011 Rs 255.36 Million)
 recognised in respect of matters relating to indirect taxes is
 dependent on the outcome of the settlement with the appropriate
 authorities.
 
 * The Company is selling certain products with a warranty of four to
 seven years. Accordingly, provision has been recognised on the basis of
 management''s expectation of warranty claims on such products.