A.  BASIS OF PREPARATION
 
 The financial statements have been prepared to comply in all material
 respects with the Accounting Standards notified by Companies
 (Accounting Standards) Rules, 2006 and the relevant provisions of the
 Companies Act, 1956. The financial statements have been prepared under
 the historical cost convention on an accrual basis except as stated
 otherwise. The accounting policies have been consistently applied by
 the Company and are consistent with those used Ih the previous year.
 
 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 at the date of the
 financial statements and the results of operations during the reporting
 period. Although these estimates are based upon management''s best
 knowledge of current events and actions, actual results could differ
 from these estimates. Difference between the actual result and
 estimates are recognised in the period in which the results are known /
 materialized.
 
 C.  PRESENTATION AND DISCLOSURE OF FINANCIAL STATEMENTS
 
 During the year ended March 31, 2012, the revised schedule VI notified
 under the Companies Act 1956, has become applicable to the Company, for
 preparation and presentation of its financial statements. The adoption
 of revised schedule VI does not impact recognition and measurement
 principles followed for preparation of financial statements. However,
 it has significant impact on presentation and disclosures made in the
 financial statements. The company has also reclassified the previous
 year figures in accordance with the requirements applicable in the
 current year.
 
 D.  FIXED ASSETS
 
 i.  Fixed Assets are stated at historical cost less depreciation. The
 cost comprises directly attributable costs such as freight, insurance
 and specific installation charges for bringing the assets to their
 working condition for intended use.
 
 ii.  Intangible Assets are recognized on the basis of recognition
 criteria as set out in Accounting Standard AS-26 Intangible
 Assets.
 
 E DEPRECIATION
 
 Depreciation is provided on the basis of Straight Line Method as per
 the rates and in the manner prescribed in Schedule XIV of the Companies
 Act, 1956.
 
 F. INVENTORIES
 
 i. Finished Goods are valued at cost or net realizable value whichever
 is lower.
 
 ii.  Raw materials are valued at lower of cost or net realizable value
 (NRV).
 
 iii. By products are valued at estimated realizable price.
 
 iv.  Stores and Spare parts are valued at/or under cost.
 
 Cost for the purpose of inventory valuation is computed on FiFO (First
 In First Out) basis.
 
 G. REVENUE RECOGINTION
 
 Revenue is recognized on mercantile basis except for claims/insurance
 claims, which are accounted for on ascertainment basis in view of
 uncertainty involved in determining the final amount.
 
 Interest income on fixed deposit with bank is recognized on time
 proportion basis taking into account the amount outstanding and the
 rate applicable.
 
 Dividend income from investments is recognized when the Company''s right
 to receive payment is established.
 
 H.  CASH AND CASH EQUIVALENTS
 
 Cash and cash equivalents comprise cash at bank and in hand and short
 term investments with an original maturity of three months or less.
 
 I.  SUBSIDIES
 
 State subsidies are accounted for on receipt basis.
 
 J. RETIREMENT BENEFITS
 
 i.  GRATUITY
 
 Provision for Gratuity in the nature of defined benefit obligation is
 considered on the basis of revised Accounting Standard (AS-15) on
 actuarial valuation. The discount rate and other actuarial assumptions
 are based on the parameters defined in the Accounting Standard.
 
 ii.  PROVIDENT FUND
 
 Company''s contribution to the Provident Fund in the nature of Defined
 Contribution Plan is being charged to Statement of Profit & Loss
 Account in the year in which services are rendered by the employees.
 
 iii. LEAVE ENCASHMENT
 
 Short term benefits are provided for on accrual basis on the basis of
 management estimates.
 
 K. TAXES ON INCOME
 
 Income tax expense is accounted for in accordance with AS-22,
 Accounting for Taxes on Income, as stated below:
 
 i.  Provision for current tax is made based on taxable income for the
 year computed in accordance with provisions of the Income Tax Act,
 1961.
 
 ii.  Deferred tax is recognized, subject to the consideration of
 prudence, on timing differences, being the difference between taxable
 income and accounting income that originate in one period and are
 capable of reversal In one or more subsequent periods.
 
 iii. 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 and deferred tax liabilities are offset, if a legally
 enforceable right exists to set off current tax assets against current
 tax liabilities and the deferred tax assets and deferred tax
 liabilities relate to the taxes on income levied by same governing
 taxation laws.
 
 Deferred tax asset is recognized and carried forward to the extent that
 there is a reasonable certainty of realization.  In the case of
 unabsorbed depreciation and carry forward tax losses deferred tax asset
 is recognized, to the extent there is virtual certainty that sufficient
 future taxable income will be available against which such deferred tax
 assets can be realized.
 
 L. IMPAIRMENT OF ASSETS
 
 Impairment loss is recognized wherever the carrying amount of an asset
 is in excess of its recoverable amount and the same is recognized as an
 expense in the statement of profit and loss account and carrying amount
 of the asset is reduced to its recoverable amount. Post impairment,
 depreciation is provided on the revised carrying value of the asset
 over its remaining useful life. Reversal of impairment losses
 recognized in prior years is recorded when there is an indication that
 the impairment losses recognized for the asset no longer exist or have
 decreased.
 
 M. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS
 
 Provisions are recognized for liabilities that can be measured by using
 a substantial degree of estimation, if
 
 i.  the Company has a present obligation as a result of a past event,
 
 ii.  a probable outflow of resources is expected to settle the
 obligation and
 
 iii. the amount of the obligation can be reliably estimated.
 Contingent Liability is disclosed in the case of
 
 i.  a present obligation arising from the past event, when it is not
 probable that an outflow of resources will be required to settle the
 obligation.
 
 ii.  a possible obligation, unless the probability of outflow of
 resources is remote.
 
 Contingent Assets are neither recognized nor disclosed.
 
 Provisions, Contingent liabilities and Contingent assets are reviewed
 at each Balance Sheet date.
 
 N. 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.
 
 O.  SEGMENT POLICIES
 
 The Company''s reporting segments are identified based on
 activities/products, risk and reward structure, organization structure
 and internal reporting systems.
 
 P. INVESTMENTS
 
 Investments intended to be held for more than a year are classified as
 long term investments. All other investments are classified as current
 investments. Current investments are stated at lower of cost and
 market/fair value. Long term investments are stated at cost Decline in
 value of long term investments is recognized, if considered other than
 temporary, 
 
 R. BORROWING COSTS
 
 Borrowing costs directly attributable to the acquisition, construction
 or production of an asset that necessarily takes a substantial period
 of time to get ready for its intended use or sale are capitalized as
 part of the cost of the respective asset All other borrowing costs are
 expensed in the period they occur. Borrowing costs consist of interest
 and other costs that an entity incurs in connection with the borrowing
 of funds.