A.  The financial statements are prepared under historical cost
 convention on an accrual basis and in accordance with the applicable
 Accounting Standards and the relevant provisions of the Companies Act,
 1956.
 
 B.  FIXED ASSETS:
 
 a) Certain assets had been revalued by the Company in the year 1993 -
 1994, these assets are appearing at revalued amounts less accumulated
 depreciation. All other assets are appearing at historical cost less
 accumulated depreciation.
 
 b) Depreciation in respect of Factory Building, Plant & Machinery for
 SF6 Project, Electric Installation for SF6 project, R&D Plant &
 Machinery, Factory Buildings at Plot No. 85-B and Plot Nos. 85/D & E
 has been provided on straight line method and in respect of all other
 assets on written down method at the rate specified in accordance with
 Schedule XIV of the Companies Act, 1956.
 
 c) No amortisation is provided in accounts in respect of Leasehold
 Land.
 
 d) Depreciation for the year on the assets revalued in the earlier
 years has been calculated on their respective revalued figures at the
 rate specified in accordance with Schedule XIV of the Companies Act,
 1956. The additional charge of depreciation during the year on account
 of revaluation has been withdrawn from revaluation reserve and credited
 to Profit and Loss Account.
 
 e) Intangible Assets are identified when they are expected to provide
 future enduring economic benefits. The assets are identified in the
 year in which the relevant asset is put to use. The assets are
 amortised over a period of estimated useful life as determined by the
 management. Expenditure on Know-How is amortised over a period of 10
 years on Straight Line Method. Expenditure on Software is amortised
 over a period of five year on straight line method.
 
 C.  INVENTORIES:
 
 Consumable tools, raw material, packing material, work in progress,
 finished goods and stores & spares have been valued at lower of cost
 and net realisable value. Cost of Finished Goods and Work-in-Progress
 has been ascertained at estimated cost. Cost of Raw Material has been
 ascertained on Weighted Average Cost Basis. Cost of other inventories
 has been ascertained on First-In-First-Out method (FIFO). Silver booked
 by customers for their process work has been valued at the rates at
 which the same is booked by them. Scrap is valued at Net Realizable
 Value.
 
 D.  INVESTMENTS:
 
 Long term investments are stated at cost. Provision for diminution in
 the value of investments is made only if such decline is other than
 temporary in the opinion of the management.
 
 E.  FOREIGN CURRENCY TRANSACTIONS:
 
 Transactions in foreign exchange, other than those covered by forward
 exchange contracts are accounted at the rates prevailing on the date of
 transaction. All monetary assets and liabilities denominated in foreign
 currency are restated at the rate prevailing at the year end. All other
 exchange differences are accounted for in the Profit & Loss Account
 except in case of transactions covered by forward exchange contracts
 where exchange difference is recognized over the life of the contract.
 
 F.  REVENUE RECOGNITION:
 
 Dividend is accounted as and when received.
 
 Sales is recognized when the significant risk and rewards of ownership
 of the goods are passed on to the customer. Sales is inclusive of
 excise duty, exclusive of Value Added Tax (VAT) and is net of returns.
 
 G.  EMPLOYEE BENEFITS:
 
 a) Short Term Employee benefits are recognised as an expense at the
 undiscounted amounts in the Profit & Loss Account of the year in which
 the related service is rendered.
 
 b) Contribution payable to the recognised Provident Fund which is
 Defined Contribution Scheme is charged to Profit & Loss Account.
 
 c) Liabilities in respect of Defined Benefit Plans are determined based
 on actuarial valuation made by an independent actuary as at the Balance
 Sheet date. The actuarial gains or losses are recognised immediately in
 the Profit & Loss Account.
 
 d) In case of non-member of the Gratuity Fund, the same is provided as
 per the approval of Central Government and as per Payment of Gratuity
 Act, 1972, wherever applicable.
 
 H.  TAXATION:
 
 a) Provision for Current Tax is made in the accounts on the basis of
 estimated Tax Liability, as per the applicable provision of the Income-
 tax Act, 1961.
 
 b) The Deferred Tax for timing difference between Book Profits and Tax
 Profits for the year is accounted for using the tax rate and laws that
 have been enacted or substantially enacted as of the Balance Sheet
 Date. Deferred Tax assets arising from timing differences are
 recognized to the extent there is a virtual certainty that these would
 be realized in future and are reviewed for the appropriateness of their
 respective carrying values at each Balance Sheet Date.
 
 1.  LEASE:
 
 Lease rentals in respect of assets acquired under operating leases are
 charged off to the Profit & Loss Account as incurred. Lease rentals in
 respect of assets given under operating leases are credited to the
 Profit & Loss Account.
 
 J.  IMPAIRMENT OF ASSETS:
 
 The company assesses at each Balance Sheet date whether there is any
 indication that an asset may be impaired. If any such indication
 exists, the management estimates the recoverable amount of the asset.
 If such recoverable amount of the asset is less than its carrying
 amount, the carrying amount is reduced to its recoverable amount. The
 reduction is treated as an impairment loss and is recognized in the
 Profit and Loss Account. If at the Balance Sheet date there is an
 indication that a previously assessed impairment loss no longer exists,
 the recoverable amount is reassessed and the asset is reflected at the
 recoverable amount subject to a maximum of depreciated historical cost.
 
 K.  PROVISION AND CONTINGENT LIABILITIES:
 
 The company creates a provision where there is a present obligation as
 a result of a past event that probably requires an outflow of resources
 and a reliable estimate can be made of the amount of the obligation.
 Disclosure of a contingent liability is made when there is a possible
 obligation or a present obligation that may, but probably will not,
 require an outflow of resources. Where there is a possible obligation
 or a present obligation in respect of which the likelihood of outflow
 of resources is remote, no provision or disclosure is made.