(A). GENERAL
 
 1.  The company follows the mercantile system of accounting and
 recognizes income and expenditure on accrual basis.
 
 2.  These accounts have been prepared on the Historical cost basis and
 on the accounting principles as a going concern.
 
 3.  Accounting policies unless specially stated to be otherwise are
 consistent are in consonance with generally accepted accounting
 principles.
 
 (B). FIXED ASSETS & DEPRECIATION
 
 Fixed Assets are stated at cost less accumulated depreciation. The
 Company is following the straight-line method of depreciation.
 Depreciation is provided at the rates as specified in Schedule XIV of
 the Companies Act, 1956 on prorata basis. Previous Year figures are
 regrouped and rearranged when necessary.
 
 (C). REVENUE RECOGNITION
 
 Sale of products and services are recognized when products are
 dispatched or services are rendered.
 
 (D). INVENTORIES
 
 1.  Inventories are valued at cost or Net Realizable ValuefNRV) which
 ever is less by using First In First Out method.
 
 2.  The Raw Material Stores & Spares are valued at lower of cost or
 estimated net realizable value.
 
 3.  The Finished Goods have been valued at lower of cost or net
 realizable value.
 
 (E). RETIREMENT BENEFITS
 
 Contribution to provident fund is made in accordance with the Provision
 of The Employees Provident Fund and Miscellaneous Provision Act, 1952.
 The gratuities are accounted for on cash basis.
 
 (G). CONTINGENT LIABILITIES
 
 An interest amount of Rs 3,75,00000/- is the contingent liabilities due
 to non listing of preferential share in the stock exchange till date.
 
 TAXATION
 
 Deferred Tax has been recognized as per Accounting Standard 22 issued
 by The
 
 Institute of Chartered Accountants of India.