a.  Basis of preparation of accounts
 
 The financial statements have been prepared to comply in all material
 respects with the Accounting Standards notified by the Companies
 Accounting Standards Rules, 2006and the relevant provisions of the
 Companies Act, 1956.
 
 b.  Use of estimates
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles requires management to make estimates
 and assumptions that affect the reported amounts of assets and
 liabilities and disclosure of contingent liabilities.
 
 c.  Fixed assets 
 
 i)Tangib!e assets
 
 Fixed assets are stated at cost of acquisition inclusive of duties (net
 of CENVAT and other credits, wherever applicable), taxes, incidental
 expenses, erection / commissioning expense s and borrowing costs etc.
 up to the date the assets are ready for their intended use.
 
 Machinery spares which can be used only in connection with an item of
 fixed assets and whose use as per technical assessment is expected to
 be irregular, are capitalised and depreciated over the residual life of
 the respective assets.
 
 Expenditure directly relating to construction activity are capitalised.
 Indirect expenditure incurred during construction period are
 capitalised as part of the indirect construction cost to the extent to
 which the expenditure are indirectly related to con.
 
 Fixed Assets retired from active use are valued at net realisable
 value.
 
 ii)intangible assets
 
 Intangible assets are stated at cost less accumulated amortisation.
 Computer software is amortised on a straight line basis over a period
 of five years (except ERP software which is amortised over a period of
 three years)
 
 d.  Depreciation
 
 Depreciation on Fixed Assets is provided on written down value method
 at the rates prescribed in Schedule XTV of the Companies Act, 1956 or
 atrates determined based on the useful life of the assets, whichever is
 higher.
 
 In case of impairment, if any, depreciation is provided on the revised
 carrying amount of the assets over meir remaining useful life.
 
 Assets created but not owned by the Company are amortised over a period
 of five years.
 
 e.  Impairment of assets
 
 The carrying amount of assets is reviewed at each balance sheet date to
 determine if were is any indication of impairment there of based on
 external / internal factors. An impairment loss is recognized wherever
 the carrying amount of an asset exceeds its.
 
 f.  Investments
 
 Investments that are readily realisable and intended to be held for not
 more than a year are classified as current investments. All other
 investments are classified as long-term Current investments are carried
 at lower of cost and fair value.
 
 g.  Inventories
 
 Items of inventories are valued at lower of cost and net realizable
 value, on the following basis:
 
 Raw materials, components, stores and spares - on a first in first out
 basis.
 
 Work-in-process and finished goods - on the basis of absorption costing
 comprising of direct costs and overheads other than financial charges.
 
 h.  Revenue recognition
 
 Revenue (income) is recognised when no significant uncertainty as to
 determination/ realisation exists.
 
 Sale of goods
 
 Revenue is recognised when the significant risks and rewards of
 ownership of the goods have passed to the buyer.
 
 Insurance and other claims /refunds
 
 Revnue, due to uncertainty in realisation, are accounted for on
 acceptance / actual receipt basis.
 
 Interest
 
 Revenue is recognised on a time proportion basis taking into account
 the amount outstanding and the rate applicable.
 
 Dividends
 
 Dividend is recognised when the shareholders'' right to receive payment
 is established by the balance sheet date. Dividend from subsidiaries is
 recognised even if same are declared after the balance sheet date but
 pertains to period on or before the date of Balance Sheet.
 
 Export benefits
 
 Export entitlements in the form of Duty Drawback and Duty Entitlement
 Pass Book (DEPB) Scheme are recognised in the Profit and loss Account
 when the right to receive credit as per the terms of the scheme is
 established in respect of exports made and when.
 
 i.  Retirement an other employee benefits
 
 Retirement benefit in the form of Provident Fund is defined
 contribution scheme and the contributions are charged to the Profit and
 Loss Account of the year when the contributions to the respective funds
 are accrued.
 
 Gratuity liability is a defined benefit obligation and is provided for
 on the basis of actuarial valuation made at the end of each financial
 year.
 
 Short term compensated absences are provided for based on estimates.
 Long term Compensated absences are provided for based on actuarial
 valuation.
 
 Actuarial gains/losses are immediately taken to profit and loss account
 and are not deferred.
 
 j.  Borrowing costs
 
 Borrowing costs relating to the acquisition / construction of
 qualifying assets are capitalised until the time all substantial
 activities necessary to prepare the qualifying assets for their
 intended use are complete.
 
 k.  Foreign currency transactions
 
 Foreign currency transactions are recorded on the basis of exchange
 rates prevailing on the date of their occurrence. Foreign currency
 monetary items are reported using the closing rates and exchange
 difference arising thereon is charged to the Profit and Loss Account.
 
 L Taxation
 
 Tax expense comprises of current and deferred tax. Current income-taxis
 measured at the amount expected to be paid to the tax authorities in
 accordance with the Indian Income Tax Act, 1961.
 
 Deferred tax is recognized on a prudent basis for timing differences,
 being difference between taxable and accounting income/expenditure that
 originate in on period and are capable of reversal in one or more
 subsequent period (s).
 
 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.