1. ACCOUNTING CONVENTION
 
 The Company follows the mercantile systems of accounting i.e. all
 income and expenses are accounted for on accrual basis.
 
 2. FIXED ASSETS
 
 Fixed Assets are stated at cost less accumulated depreciation. Cost is
 inclusive of freight, duties, levies and any directly attributable cost
 of bringing the assets to their working condition for intended use.
 
 3. DEPRECIATION
 
 Depreciation is provided as per the W.D.V. method at rates (single
 shift basis) provided under Schedule XIV to the  Companies Act, 1956.
 Manufacturing activities at Bhiwadi, Sikandrabad and NEP2 Unit were
 stopped w.e.f. February. 1998. December 1998 and July 1999
 respectively. However depreciation has been provided upto March, 2002.
 
 4. INVESTMENTS
 
 Investments are stated at cost.
 
 5. INVENTORIES
 
 Stock in trade is valued at cost or net realisable value, whichever is
 lower. The basis of determining cost of inventories are as follows:
 
 Finished Goods Material Cost Plus Direct Expenses.
 
 6. FOREIGN EXCHANGE TRANSACTIONS 
 
 There is no foreign exchange transaction as such.
 
 7. SALES
 
 Sale of goods is recognised at the point of despatch to the customer.
 Sales excludes the sales tax amount.
 
 8. DIVIDEND
 
 No provision is made in the financial statements for dividend as
 Directors have not recommended any dividend due to loses in the
 company, even on  preference shares.
 
 9. GRATUITY
 
 The provision of gratuity is on accrual basis.