(a) Basis of Accounting
 
 The Financial Statements have been prepared under historical cost
 convention in accordance with the generally accepted accounting
 principles and the provisions of the Companies Act, 1956, as adopted
 consistently followed by the Company. The Company generally follows
 mercantile system of accounting and recognizes significant items of
 income and expenditure on accrual basis.
 
 (b) Fixed Assets
 
 Fixed Assets are stated at cost, net off CENVAT credit claimed, less
 accumulated depreciation and less impairment if any.
 
 Items having cost of less than Rs.5000/- and having useful life of less
 than one year like calculators, mobile phones and other electronic
 office equipment except computers are charged out to Profit & Loss
 account in the year it is put to use.
 
 (c) Depreciation
 
 Depreciation on Tangible Fixed Assets is provided on the Straight Line
 Method at the rates and in manner prescribed in Schedule XIV to the
 Companies Act, 1956.
 
 (d) Investments
 
 Investments are stated at cost. Provision is made to recognize
 diminution, other than temporary, in the carrying amount of long term
 investment.
 
 (e) Inventories
 
 Finished and Semi-Finished stock is valued at the lower of cost or net
 realisable value. The cost of finished goods is determined on
 consistent basis, accepting the average direct and indirect expenses
 related to the production during the year. Raw materials, goods in
 transit and stores & spares are valued at landed cost or market value
 whichever is less.
 
 (f) Sales
 
 Sales represent the amount of receivables for goods sold including the
 value of Excise Duty.
 
 (g) Impairment of Assets
 
 An asset is treated as impaired when the carrying cost of assets
 exceeds its recoverable value. An impairment loss is charged to the
 Profit and Loss Account in the year in which an asset is identified as
 impaired. The impairment loss recognized in prior accounting periods is
 reversed if there has been a change in the estimate of recoverable
 amount.
 
 (h) Foreign Currency Transactions
 
 Transaction in Foreign Currency are recorded at the exchange rate
 prevailing on the date of transaction.  At the year-end, monetary items
 denominated in foreign currency are reported using the rate of exchange
 prevailing on the last day of year.  Exchange difference arising on
 realization / payment of foreign exchange if on account of revenue are
 accounted to the Profit & Loss Account in the year of realization/
 payment.
 
 (i) Amortization of Miscellaneous Preliminary & Share Issue
 Expenditure Preliminary Expenses are being written off in the year in
 which it is incurred as per the Accounting Standard 26 Intangible
 assets issued by The Institute of Chartered Accountants of India,
 which has been mandatory w.e.f. 01/04/2004.
 
 (j) Provision for Gratuity and Leave Encasement
 
 (1) The Company has created an Employee''s Group Gratuity Fund which has
 taken a Group Gratuity-cum- Life Insurance Policy from the Life
 Insurance Corporation of India. Gratuity is provided on the basis of
 premium paid on the above policy as intimated by Life Insurance
 Corporation of India. The adequacy of the fund along with the provision
 is as per the actuarial valuation done by Life Insurance Corporation of
 India.
 
 (2) Liability for leave encashment has been determined and accrued for,
 based on the number of days of en-cashable leave to the credit of each
 employee as on the balance sheet date. Treating it as Short Term
 employee Benefits.
 
 (k) Taxation
 
 Provision for current tax is made in the accounts on the basis of
 estimated tax liability as per the applicable provisions of the Income
 Tax Act, 1961.
 
 Deferred tax for timing difference between tax profits and book profits
 is accounted for using the tax rates and laws that have been enacted or
 substantially enacted as of the balance sheet date. Deferred tax assets
 are recognized to the extent there is supported by convincing evidence
 that these assets can be realized in future.-
 
 (I) Use of Estimates
 
 The presentation of financial statements requires estimates and
 assumption to be made that affect the reported amount of assets and
 liabilities on the date of the financial statement and the reported
 amount of revenue and expenses during the reporting period. Difference
 between the actual results and estimates are recognized in the period
 in which the result are known / materialized.
 
 (m) Provision, Contingent Liabilities and Contingent Assets
 
 Provisions involving substantial degree of estimation in measurement
 are recognized when there is a present obligation as a result of past
 events and it is probable that there will be an outflow of resources.
 Contingent Liabilities are not recognized but are disclosed in the
 notes. Contingent Assets are neither recognized nor disclosed in the
 financial statements.