(i) GENERAL
 
 a) The financial statements have been prepared in accordance with
 applicable Accounting Standards and relevant presentational
 requirements of the Companies Act, 1956 and are based on the historical
 cost conventions.
 
 b) The Company follows the mercantile system of accounting and
 recognise income and expenses (including financial charges) on accrual
 basis except claims
 
 (ii) FIXED ASSETS
 
 Fixed Assets are stated at cost of acquisition inclusive of freight,
 duties, taxes and pre- operative expenses relating to period prior to
 commencement of commercial production and net of Cenvat credit availed.
 
 (iii) DEPRECIATION
 
 a) Depreciation is provided as per the Straight Line Method at the
 rates provided in Schedule XIV to the Compa- nies Act, 1956.
 
 b) Depreciation has been calculated on a pro-rata basis from the month
 of acquisition / installation of additions to assets during the year,
 and pro-rata upto the month of disposal in case of deletion.
 
 c) No amount is being written off on Leasehold land and Freehold land.
 
 (iv) INVENTORIES
 
 a) Stores, spare parts, loose tools, raw material and packing material
 are valued at cost or net realizable value, whichever is less.
 
 b) Finished goods are valued at material cost plus expenses or net
 realizable value, whichever is less.
 
 c) Stock in trading division is valued at cost and related expenses or
 net realizable value, whichever is less.
 
 d) Stock in process is valued at material cost plus attributable
 expenses or net realizable value, whichever is less.
 
 (v) RESEARCH AND DEVELOPMENT
 
 Revenue expenditure on research and development is charged as an
 expense in the year in which it is incurred.  Capital expenditure on
 Research and Development is included in Fixed Assets.
 
 (vi) SALES
 
 Sales of goods are recognised at the point of despatch from factory to
 customers and sales from Depot are recognised at the time of billing to
 the customers. Sales are net of returns, rebate, damaged goods and
 exclusive of vat/sales tax.
 
 (vii) PROVISION FOR TAXATION
 
 Provision for current tax is made after taking into consideration
 benefits admissible under the provisions of the Income Tax Act, 1961.
 Deferred tax resulting from timing difference between book and
 taxable profit is accounted for using the tax rates and laws that are
 enacted as on the balance sheet date. The deferred tax asset is
 recognized and carried forward only to the extent that there is a
 reasonable certainty that the asset will be realized in future.
 
 (viii) RETIREMENT BENEFITS
 
 (a) The company has a group gratuity scheme for eligible employees with
 Life Insurance Corporation of India (LIC). The group gratuity scheme is
 a defined benefit scheme and is funded in the line with LIC''s actuarial
 valuation.
 
 (b) Provision for liabilities in respect of leave encashment is made on
 the basis of actual leaves as at the balance sheet date.
 
 (c) Contributions to provident fund are recognised as expenses when
 incurred.
 
 (ix) FOREIGN CURRENCY TRANSACTIONS
 
 Transactions in foreign currencies are recorded at the exchange rates
 prevailing on the date of acquisition. Mon- etary items are translated
 at the rates prevailing on reporting dates. The exchange difference
 between rate prevail- ing on the date of transaction and on the date of
 settlement and also on translation of monetary items at the reporting
 date is recognized as income or expense.
 
 (x) EARNING PER SHARES
 
 Basic earning per share is calculated by dividing the net profit for
 the year attributable to equity shareholders by the weighted average
 number of equity shares outstanding during the year.
 
 Diluted earning per share is calculated by dividing the net profit for
 the year attributable to equity shareholders by the weighted average
 number of equity shares outstanding during the year (adjusted for the
 effects of dilutive options)
 
 (xi) BORROWING COST
 
 Borrowing cost attributable to acquisition, construction or production
 of qualifying assets are capitalized as part of the cost till the
 assets is ready for use. Other borrowing costs are recognized as
 expense in the period in which these are incurred.
 
 (xii) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
 
 Provisions involving substantial degree of estimation in measurement
 are recognized when there is a present obliga- tion as a result of past
 events and it is probable that there will be an outflow of resources.
 Contingent liabilities are disclosed in the Notes to Accounts.
 Contingent assets are neither recognized nor disclosed in the financial
 state- ments.
 
 (xiii) EVENTS OCCURING AFTER BALANCE SHEET DATE
 
 Events occurring after balance sheet date have been considered in the
 preparation of financial statement.
 
 (xiv) IMPAIRMENT OF ASSETS
 
 An asset is treated as impaired, when the carrying cost of asset
 exceeds its recoverable value. An impairment loss, if any, is charged
 to profit and loss account, in the year in which asset is identified as
 impaired.