a.  Basis of preparation of financial statements
 
 The financial statements are prepared under historical cost convention
 in accordance with the generally accepted accounting principles in
 India (Indian GAAP) and comply in all material respects with the
 mandatory Accounting Standards (AS) prescribed in the Companies
 (Accounting Standard) Rules, 2006, as amended, and with the relevant
 provisions of the Act, pronouncements of The Institute of Chartered
 Accountants of India (''ICAI''). The financial statements have been
 prepared under the historical cost convention on an accrual basis. The
 accounting policies applied by the Company are consistent with those
 used in the previous year.
 
 b.  Use of estimates
 
 The preparation of the financial statements in conformity with GAAP
 requires management to make estimates and assumptions that affect the
 reported balances of assets and liabilities and disclosures relating to
 contingent assets and liabilities as at the date of the financial
 statements and reported amounts of income and expenses during the
 period. Examples of such estimates include provisions for doubtful
 debtors and other receivables, provision for inventories, future
 obligations under employee retirement benefit plans, income taxes, and
 the useful lives of fixed assets.
 
 Although these estimates are based upon management''s best knowledge of
 current events and actions, actual results could differ from these
 estimates. Any revision to accounting estimates is recognized
 prospectively in the current and future periods.
 
 c.  Fixed assets
 
 Fixed assets are stated at cost less accumulated depreciation and
 impairment losses, if any. Cost comprise of purchase price, freight,
 non-refundable duties, taxes and any other cost attributable to
 bringing the asset to its working condition for its intended use.
 Borrowing costs relating to acquisition of fixed assets which takes
 substantial period of time to get ready for its intended use are also
 included to the extent they relate to the period till such assets are
 ready for its intended use. Assets retired from active use and held for
 disposal are stated at their estimated net realisable values or net
 book values, whichever is lower. Advances paid towards the acquisition
 of fixed assets and outstanding at each balance sheet date and the cost
 of assets under construction are disclosed as capital work-in-progress.
 
 d.  Depreciation
 
 Depreciation is provided on straight line method based on useful lives
 of the assets as estimated by management which coincides with rates
 prescribed under Schedule XIV to the Act.
 
 Depreciation on sale/discarded from fixed assets is provided for up to
 the date of sale /discarded as the case may be. Individual assets
 acquired for Rs. 5,000 or less are entirely depreciated in the year of
 acquisition.
 
 e.  Intangible assets
 
 Intangible assets are recorded at the consideration paid for
 acquisition. Intangible assets are amortized over a period of 6 years,
 on a straight line basis.
 
 f.  Impairment of assets
 
 The carrying amounts of assets, both tangible and intangible, are
 reviewed at each balance sheet date if there is any indication of
 impairment based on internal and /or external factors. An impairment
 loss is recognized wherever the carrying amount of an asset exceeds its
 recoverable amount. The recoverable amount is greater of the asset''s
 net selling price and value in use. In assessing value in use, the
 estimated future cash flows are discounted to their present value at
 the weighted average cost of capital.
 
 g.  Government grants
 
 Government grants relating to specific fixed assets are adjusted
 against the cost of underlying fixed assets and revenue grants are
 credited to Profit and Loss Account on a systematic basis in the profit
 and loss account over the periods necessary to match them with the
 related costs which they are intended to compensate.
 
 h.  Investments
 
 Investments that are readily realizable and intended to be held for not
 more than a year are classified as current investments. All other
 investments are classified as long term investments. Current
 investments are carried at lower of cost and fair value determined on
 an individual investment basis.  Long term investments are carried at
 cost. However, provision for diminution in value is made to recognise a
 decline other than temporary in the value of the investments.
 
 i.  Inventories
 
 Raw material, Work in progress, packaging material, stores and spare
 parts are carried at cost. Cost includes purchase price excluding taxes
 those are subsequently recoverable by the enterprise from the concerned
 revenue authorities, freight inwards and other expenditure incurred in
 bringing such inventories to their present location and condition. Cost
 is determined using the weighted average cost. The carrying cost of raw
 materials, packaging materials and stores and spare parts are
 appropriately written down when there is a decline in replacement cost
 of such materials and finished products in which they will be
 incorporated are expected to be sold below cost.
 
 Manufactured finished goods and traded goods are valued at the lower of
 cost and net realizable value. Cost of work in progress and
 manufactured finished goods is determined on weighted average basis and
 comprises cost of direct material, cost of conversion and other costs
 incurred in bringing these inventories to their present location and
 condition. Cost of traded goods is determined on weighted average
 basis. Excise duty liability is included in the valuation of closing
 inventory of finished goods.
 
 j.  Research and development
 
 Revenue expenditure on research and development is expensed as
 incurred. Capital expenditure incurred on research and development is
 capitalized as fixed assets and depreciated in accordance with the
 depreciation policy of the Company.
 
 k.  Revenue recognition
 
 Revenue is recognized to the extent that it is probable that the
 economic benefits will flow to the Company and the revenue measured and
 collectability is reasonably assured.
 
 - Revenue from sale of goods is recognized when significant risks and
 rewards in respect of ownership of products are transferred to
 customers. Revenue from domestic sales of formulation products is
 recognized on dispatch of products to stockiest by clearing and
 forwarding agents of the Company. Revenue from domestic sales of active
 pharmaceutical ingredients and intermediates is recognized on dispatch
 of products from the factories of the Company. Revenue from export
 sales is recognized on shipment of products.
 
 - Revenue from product sales is stated exclusive of sales tax and
 applicable trade discounts and allowances.
 
 - Revenue from sale of dossiers is recognized in accordance with the
 terms of the relevant agreements as generally accepted and agreed with
 the customers.
 
 - Dividend income is recognized when the unconditional right to receive
 the income is established.  Income from interest on deposits, loans and
 interest bearing securities is recognized on the time proportionate
 methods taking into account the amount outstanding and the rate
 applicable.
 
 - Export entitlements are recognized as income when the right to
 receive credit as per the terms of the scheme is established in respect
 of the exports made and where there is no significant uncertainty
 regarding the ultimate collection of the relevant export proceeds.
 
 - Revenue from licensing and long term supply arrangements is
 recognized in the period in which the Company completes all its
 performance obligations.
 
 l.  Taxes
 
 Tax expense comprises of current and deferred tax. Current income tax
 is measured at the amount expected to be paid to the tax authorities in
 accordance with the Indian Income Tax Act, 1961. Deferred income taxes
 reflect the impact of timing differences between taxable income and
 accounting income for the period and reversal of timing differences of
 earlier periods.
 
 Deferred income taxes reflect the impact of timing differences between
 taxable income and accounting income for the period and reversal of
 timing differences of earlier periods. Deferred tax is measured based
 on the tax rates and the tax laws enacted or substantively enacted at
 the balance sheet date.  Deferred tax assets are recognized 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 situations where the Company has unabsorbed depreciation or carry
 forward tax losses, all deferred tax assets are recognized only if
 there is a virtual certainty supported by convincing evidence that they
 can be realised against future taxable profits.
 
 Unrecognized deferred tax assets of earlier years are re-assessed and
 recognized to the extent that it has become reasonably certain or
 virtually certain, as the case may be that future taxable income will
 be available against which such deferred tax assets can be realised.
 The carrying amount of deferred tax assets are reviewed at each balance
 sheet date.
 
 The Company writes-down the carrying amount of a deferred tax asset to
 the extent that it is no longer reasonably certain or virtually
 certain, as the case maybe, that sufficient future taxable income will
 be available against which deferred tax asset can be realised. Any such
 write-down is reversed to the extent that it becomes reasonably certain
 or virtually certain, as the case may be, that sufficient future
 taxable income will be available.
 
 Minimum Alternative tax (MAT) credit is recognized 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 the MAT credit becomes eligible to be recognized as an asset in
 accordance with the recommendations contained in guidance note issued
 by the ICAI, the said asset is created by way of a credit to the profit
 and loss account and shown as MAT credit entitlement. The Company
 reviews the same at each balance sheet date and writes down the
 carrying amount of MAT credit entitlement to the extent there is no
 longer convincing evidence to the effect that Company will pay normal
 income tax during the specified period.
 
 m.  Earnings per share
 
 Basic earnings per share are calculated by dividing the net profit or
 loss for the period attributable to equity shareholders by the weighted
 average number of equity shares outstanding during the period.  For the
 purpose of calculating diluted earnings per share, the net profit or
 loss for the period attributable to equity shareholders and the
 weighted average number of shares outstanding during the period are
 adjusted for the effects of all dilutive potential equity shares.
 
 n.  Foreign currency transactions
 
 Initial recognition
 
 Foreign currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate between
 the reporting currency and the foreign currency at the date of the
 transaction.
 
 Conversion
 
 Foreign currency monetary items are reported using the closing rate.
 Non-monetary items which are carried in terms of historical cost
 denominated in a foreign currency are reported using the exchange rate
 at the date of the transaction; and non-monetary items which are
 carried at fair value or other similar valuation denominated in a
 foreign currency are reported using the exchange rates that existed
 when the values were determined.
 
 Exchange differences
 
 Exchange differences arising on the settlement of monetary items or on
 reporting Group''s monetary items at rates different from those at which
 they were initially recorded during the year, or reported in previous
 financial statements, are recognized as income or as expenses in the
 year in which they arise, except in the case of exchange differences
 arising on a monetary item that, in substance, forms part of an
 enterprise''s net investment in a non-integral foreign operation has
 been accumulated in a foreign currency translation reserve in the
 enterprise''s financial statements until the disposal of the net
 investment, at which time they should be recognized as income or as
 expenses.
 
 o.  Employee benefits
 
 Provident fund
 
 The Company contributes to the provident fund maintained by the
 Regional Provident Fund Commissioner, in accordance with Employees
 provident fund and Miscellaneous Provision Act, 1952.  The provident
 fund plan is a defined contribution plan and contribution paid or
 payable is recognized as an expense in the period in which the employee
 renders services. There are no other obligations of the Company other
 than the contributions made to the fund.
 
 Gratuity
 
 Gratuity is a post employment defined benefit plan. An independent
 actuary, using the projected unit credit method calculates the defined
 benefit obligation annually. Actuarial gains or losses arising from
 experience adjustments and changes in actuarial assumptions are
 credited or charged to the profit and loss account in the period in
 which such gains or losses arises.
 
 Employee state insurance
 
 The Company contributes to the Employees State Insurance Fund
 maintained by the state authorities, in accordance with Employees State
 Insurance Act, 1948. The plan is a defined contribution plan and
 contribution paid or payable is recognized as an expense in the period
 in which the employee renders services. There are no other obligations
 of the Company other than the contributions made to the funds.
 
 Leave encashment
 
 As per the Company''s policy, eligible leaves can be accumulated by the
 employees and carried forward to future periods either to be utilized
 during the service, or encashed. Encashment can be made during service
 or on resignation, or retirement of the employee. The value of benefits
 is determined based on an independent actuarial valuation using the
 projected unit credit method as at the year end.  Actuarial gains and
 losses are recognized immediately in the profit and loss account.
 
 Employee share based payments:
 
 Measurement and disclosure of the employee share-based payment plans is
 done in accordance with Securities Exchange Board of India (Employee
 Stock Option Scheme and Employee Stock Purchase
 
 (All amounts in Rs., unless otherwise stated)
 
 Scheme) Guidelines, 1999 and the guidance note on ''Accounting for
 Employee Share Based Payments'', issued by the Institute of Chartered
 Accountants of India (ICAI). The excess of market value of the stock on
 the date of grant over the exercise price of the option is recognized
 as deferred employee stock compensation and is charged to profit and
 loss account on straight-line method over the vesting period of the
 options. The unamortized portion of cost is shown under stock options
 outstanding.
 
 p.  Leases
 
 Where the lessor effectively retains all risk and benefits of ownership
 of the leased items, such leases are classified as operating lease.
 Operating lease payments are recognized as an expense in the profit and
 loss account on a straight line basis.
 
 q.  Provisions and contingent liabilities
 
 A provision is recognized when the Company has a present obligation as
 a result of past event i.e., 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 its
 present value and are determined based on best 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 best
 estimates. A disclosure of the contingent liability is made when there
 is a possible or a present obligation that may, but probably will not,
 require an outflow of resources.