1. Figures of previous year have been regrouped/recast wherever
 necessary to make them comparable with the figures of current year.
 
 2. Salary. Wages and Bonus induces Managerial remuneration comprising
 of Rs. 2,40,000/- of Directors' salary (Previous year Rs.2,40,000/-
 Directors' salary.)
 
 3. Traveling Expenses including Rupees 1,32,451/- previous year Rs.
 1,03,069/- for Director's Domestic traveling.
 
 4. As advised by experts, the Company is entitled for sales tax
 exemption and therefore no provision is made on this account, however
 no sales tax assessments are yet made. Also Income-tax assessments are
 pending for financial years 2000-2001 & 2001-2002.
 
 In view of the losses the Company does not envisage any tax liability
 under the provision of the Income tax Act for the current financial
 year and therefore no provision for Income tax has been made.
 
 5. Balances due to or due from the parties from whom confirmations are
 not received are subject to adjustment on receipt of confirmations.
 
 6. The consumption figures are ascertained on the basis of opening
 stock plus purchases less closing stock and therefore include the
 adjustments made for excess and shortages ascertained in physical
 count.
 
 7. Contingent Liabilities:
 
 (i) Outstanding Demands/Litigation pending with the Income Tax
 Department:
 
 (a) Assessment Order for the Assessment Year 1993-94 was passed under
 section 143(3) of the Income Tax Act and demand was raised for
 Rs.5,18,845/-. The said order of the assessing officer was set aside by
 the appellate authority in response to the appeal filed by the Company
 and the assessment is therefore yet to be made by the assessing
 officer.
 
 (b) Demand raised by we Assessing Officer in view of the order passed
 under Section 143(3) of the Income Tax Act for Assessment Year 1994-95
 for Rs.3,91,826/- and contested by the Company. A refund of Rs.32,574/-
 has been adjusted against the demand which is shown by the Company in
 advances.
 
 (c) Demand raised by the Assessing officer in view of the order passed
 U/s 144 of the Income-Tax Act for assessment year 1995-96 for
 Rs.15,11,652/- and contested by the Company.
 
 (d) Demand raised by the Assessing officer in view of the order passed
 U/s 144 of the Income-Tax Act for assessment year 1996-97 for
 Rs.5,16706/-. The said order of the assessing officer was set aside by
 the appellate authority in response to the appeal filed by the Company
 and assessment is therefore yet to be made by the assessing officer.
 
 (ii) The Company has preferred an application before the Honbl'e
 Settlement Commission for settlement of its liability under the
 Income-Tax Act for Assessment years from 1993-94 to 1995-96, the
 admission of which is yet pending and therefore the liability of the
 company is yet to be ascertained by the said Commission.
 
 (ii) Sales tax amounting to Rs. 62,21,278/- treated as exempted subject
 to the eligibility to be granted by respective Government Authorities
 and to be confirmed by Sales Tax Authorities.