1. ACCOUNTING CONVENTION
 
 The financial statements are prepared under the historical cost
 convention, except for certain fixed assets which are revalued, from
 books of accounts maintained on an accrual basis, in conformity with
 all material aspects with the generally accepted accounting principles
 and comply with the Accounting Standards notified underSection211
 (3C)of the Companies Act, 1956 and the relevant provisions of the
 Companies Act.
 
 2. FIXEDASSETSAND DEPRECIATION
 
 a) Fixed assets are stated at cost (net of Cenvat/value added tax)
 including freight, duties, customs, adjustments arising from exchange
 rate variation and other incidental expenses relating to acquisition
 and installation and includes amount added on revaluation, less
 accumulated depreciation and impairment loss, if any.
 
 b) Depreciation has been provided on written down value method (WDV) at
 the rates and in the manner prescribed in Schedule XlV to the Companies
 Act, 1956.
 
 c) Capital work-in-progress- Projects under which assets are not ready
 for their intended use and other capital work-in-progress are carried
 at cost, comprising direct cost, related incidental expenses and
 attributable interest.
 
 3. INVESTMENTS
 
 Long term investments intended to be held for more than a year from the
 date of acquisition, are classified as long term investments and are
 carried at cost. Provision is made for diminution, other than
 temporary, in value of investments. Current investments are valued at
 lower of cost and market value.
 
 4. INVENTORIES
 
 Items of inventories are measured at lower of cost or net realizable
 value. Cost of Raw material, stores and spares are determined on first
 in first out basis. Cost of finished goods and semi-finished goods
 include cost of raw materials and packing materials, cost of conversion
 and other costs incurred in bringing the inventories to the present
 location and condition.
 
 5. REVENUE RECOGNITION
 
 Revenue from sale of goods is accounted for on the basis of dispatch of
 goods. Sales are inclusive of excise duty and net of sales return and
 trade discounts. Interest Income is accounted on accrual basis.
 
 6. TAXATION
 
 a) INCOME TAX PROVISION
 
 The provision for taxation is based on assessable profits of the
 company as determined under the Income Tax Act, 1961.
 
 b) DEFERRED TAX
 
 As per AS-22 issued by the Institute of Charted Accountants of India,
 deferred tax is recognised, 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. Deferred Tax Asset is not
 recognised unless there are timing differences, the reversal of which
 will result in suffcient income or there is virtual certainly that
 sufficient future taxable income will be available against which such
 deferred tax asset can be realized.
 
 7. FOREIGN CURRENCYTRANSACTIONS
 
 i Foreign currency transactions are accounted for at the exchange rate
 prevailing on the transaction date.  Gain/loss arising out of
 fluctuation in rate between transaction date and settlement date in
 respect of revenue items are recongnised in the Profit and Loss
 Account.
 
 Monetary Assets and Liabilities in foreign currency are translated at
 the year - end at the closing exchange rate and the resultant exchange
 differences are recognised in the Profit and Loss Account.
 
 Non monetary foreign currency items are carried at cost.
 
 Accounting for Forward Contract
 
 In case of items which are covered by forward exchange contracts, the
 difference between the year end rate and rate on date of contracts is
 re-conginized as exchange difference and the premium paid on forward
 contracts is recognized over the life of the contract.
 
 8.INTANGIBLEASSETS
 
 Intangible Assets are stated at cost of acquisition net of recoverable
 taxes less accumulated acortization. All costs, including financing
 costs till commencement of commercial production and adjustments
 arising from exchange rate variations attributable to the intangible
 assets, are capitalized.
 
 9. RETIREMENT BENEFITS
 
 (i) Defined Contribution Plans
 
 The Company has a Defined Contribution Plan for post employment
 benefits namely Provident Fund which is administered through
 appropriate authorities.  The Company makes contributions to state
 plans namely Employees'' State insurance Fund and has no further
 obligation beyond making the payment to them.
 
 The Company''s contributions to the above funds are charged to revenue
 every year.
 
 (ii) Defined Benifit Plan The gratuity will be paid as and when
 employee leaves. Liabiliy towards gratuity id based on actuarial
 valuation carried out by the an authourized actuary which is in
 compliance with AS-15(revised) issued by the Institute of Chartered
 Accountants of India.
 
 
 13. INSURANCE CLAIMS
 
 Insurance claims are accounted for on the basis of claims admitted or
 expected to be admited and to the extent that there is no uncertainty
 in receiving the claims.
 
 14. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENTASSETS
 
 Provisions involving substantial degree of estimation in measurement
 are recognised 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, in any, are not provided for in the financial
 statements. However, they are separately disclosed by way of notes on
 accounts. Contingent Assets are neither recognised nor disclosed in the
 financial statements.
 
 15. USE OF ESTIMATES
 
 The presentation of the financial statements in conformity with the
 generally accepted accounting principles requires the management to
 make estimates and assumptions that affect the reported amounts of
 assets and liabilities revenues and expenses and disclousure of
 contingent liabilities. Such estimates and assumptions are bassed on
 management''s evaluation of relevant facts and circumstances as on the
 date of financial statements. Difference between the actual results and
 estimates are recognised in the period in which the results are
 known/materialized.
 
 16. EARNING PER SHARE
 
 As PerAS-20 issued by institute of Chartered Accountants of India basic
 earnings per share is computed using the weighted average number of
 equity shares outstanding during the period. Diluted earnings per share
 are computed using the weighted average number of equity and dilutive
 equity equivalent shares outstanding during the period, except where
 the results would be anti-dilutive.
 
 17. CASHANDCASH EQUIVALENTS
 
 Cash comprises cash on hand demand deposits with banks. Cash
 equivalents are short term (with an original maturity of three months
 or less from the date of acquisition), highly liquid investments that
 are readily convertible into known amounts of cash and which are subject
 to insignificant risk of changes in value.
 
 18. CASH FLOW STATEMENT
 
 Cash flows are reported using the indirect method, whereby profit
 before extraordinary items and tax is adjusted for the effects of
 transactions of non-cash nature and any deferrals or accruals of past
 or future cash receipts or payments. The cash flows from operating,
 investing and financing activities of the company are segregated based
 on the available information.
 
 19. SHARE ISSUE EXPENSES
 
 Share issue expenses and redemption premium are adjusted against the
 Securities Premium Account as permissible under Section 78(2) of the
 companies act, 1956; to the extent balance is available for utilization
 in the Securities Premium Account. The balance of share issue expenses
 is carried as an asset and is amortised over a period of 5 years from
 date of the issue of shares.