(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 (as amended) and the relevant provisions of the
 Companies Act, 1956 (''the Act''). The financial statements have been
 prepared under the historical cost convention on an accrual basis
 except in case of assets for which provision for impairment is made and
 revaluation is carried out, if applicable. The accounting policies have
 been consistently applied by the Company and are consistent with those
 used in the previous year, except for changes in accounting policy
 discussed more fully elsewhere.
 
 (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 end. Although these estimates are based upon management''s best
 knowledge of current events and actions, actual results could differ
 from these estimates.
 
 (c) Fixed assets
 
 Fixed assets are stated at cost, less accumulated depreciation and
 impairment losses if any. Cost comprises the purchase price and any
 attributable cost of bringing the asset to its working condition for
 its intended use. Borrowing costs relating to acquisition of fixed
 assets which takes substantial period of time to get ready for its
 intended use are also included to the extent they relate to the period
 till such assets are ready to be put to use.
 
 Advances paid towards the acquisition of fixed assets outstanding at
 each balance sheet date and the cost of fixed assets not ready for
 intended use before such date are disclosed under capital work-
 in-progress.
 
 (d) Depreciation
 
 Depreciation is provided using the straight line method in the manner
 specified in Schedule XIV to the Act, at the rates prescribed therein
 or at the rates based on Management''s estimate of the useful lives of
 such assets, whichever is higher, as follows:
 
 Asset Description Percentage
 
 Office Equipment 4.75%
 
 Computers 16.21%
 
 Furniture and Fixtures 6.33%
 
 Motor Vehicles 9.50% - 11.31%
 
 Plant and Machinery 4.75%
 
 Rotable and Tools 5.60%
 
 Leasehold improvements are amortised over the estimated useful lives or
 the remaining primary lease period, whichever is less. Assets
 individually costing Rupees five thousand or less are fully depreciated
 in the year of purchase.
 
 (e) Intangible assets
 
 Computer software
 
 Costs incurred towards purchase of computer software are depreciated
 using the straight-line method over a period of 3 years based on
 management''s estimate of useful lives of such software, or over the
 license period of the software, whichever is shorter.
 
 (f) Impairment
 
 i.  The carrying amounts of assets are reviewed at each balance sheet
 date if there is any
 
 indicationof impairment based on internal / external factors. An
 impairment loss is recognized wherever the carrying amount of an asset
 exceeds its recoverable amount. The recoverable amount is the greater
 of the asset''s net selling price and its value in use. In assessing
 value in use, the estimated future cash flows are discounted to their
 present value using a pre-tax discount rate that reflects current
 market assessments of the time value of the money and risks specific to
 the asset.
 
 ii. After impairment, depreciation is provided on the revised carrying
 amount of the asset over its remaining useful life.
 
 iii. A previously recognized impairment loss is increased or reversed
 depending on changes in circumstances. However, the carrying value
 after reversal is not increased beyond the carrying value that would
 have prevailed by charging usual depreciation if there was no
 impairment.
 
 (g) Investments
 
 Investments that are readily realisable and intended to be held for not
 more than a year are classified as current investments. All other
 investments are classified as long-term investments. Current
 investments are carried at lower of cost and fair value determined on
 an individual investment basis.  Long-term investments are carried at
 cost. Provision for diminution in value is made to recognise a decline
 other than temporary in the value of long term investments.
 
 (h) Inventories
 
 Inventories comprises of expendable aircraft spares and miscellaneous
 stores. Inventories have been valued at cost or net realizable value,
 whichever is lower after providing for obsolescence and other losses,
 where considered necessary. Cost includes customs duty, taxes, freight
 and other charges, as applicable and is determined using weighted
 average method.
 
 (i) Leases
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased item, are classified as
 operating leases. Operating lease payments are recognized as an expense
 in the Profit and Loss account on a straight-line basis over the lease
 term.
 
 Sale and lease back arrangements
 
 Profit or loss on sale and lease back arrangements resulting in
 operating leases are recognized immediately in case the transaction is
 established at fair value, else the excess of the sale price over the
 fair value is deferred and amortized over the period for which the
 asset is expected to be used.
 
 The sale and lease back arrangements entered into by the Company are as
 per the standard commercial terms prevalent in the industry. The
 Company does not have an option to buy back the aircraft, nor does it
 have an option to renew or extend the lease after the expiry of the
 lease.
 
 (j) Provisions
 
 A provision is recognized when an enterprise has a present obligation
 as a result of past event and it is probable that an outflow of
 resources will be required to settle the obligation, in respect of
 which a reliable estimate can be made.  Provisions are not discounted
 to its present value and are determined based on best estimate of
 amounts required to settle the obligation at the balance sheet date.
 These are reviewed at each balance sheet date and adjusted to reflect
 the current best estimates.
 
 (k) Revenue recognition
 
 Revenue is recognized to the extent that it is probable that the
 economic benefits will flow to the Company and the revenue can be
 reliably measured.
 
 Passenger revenues and cargo revenues are recognised as and when
 transportation is provided i.e.  when the service is rendered. Amounts
 received in advance towards travel bookings / reservations are shown
 under current liabilities as unearned revenue.
 
 Other operating revenues in the nature of fees charged from passengers
 for reservation, changes in itinerary, cancellation of flight tickets
 etc. are recognised as revenues on accrual basis.
 
 Income in respect of hiring / renting out of equipments and spare parts
 is due on time proportion basis at rates agreed with the lessee. Due to
 significant uncertainties involved in realization, the income is
 recorded on settlement with the lessee or actual realization, whichever
 is earlier.
 
 Interest
 
 Interest income is recognised on a time proportion basis taking into
 account the amount outstanding and the rate applicable.
 
 (l) Manufacturers incentives
 
 (i) Cash Incentives
 
 The Company receives incentives from Original equipment manufacturers
 (''OEM''s'') of aircraft components in connection with acquisition of
 aircrafts. These incentives are recognized as income coinciding with
 delivery of the related aircrafts as there are no further conditions
 required to be fulfilled.
 
 (ii) Non-cash Incentives
 
 Free of cost spare parts received in respect of purchase of aircraft''s
 are recorded at a nominal value.
 
 During the current year, the Company has changed its accounting policy
 on accounting for free of cost spare parts received. Previously, the
 Company was recording the free of cost spare parts received at their
 fair value. The management believes that such a change will result in a
 more appropriate presentation of assets under generally accepted
 accounting standards in India. Had the Company continued to use its
 earlier policy in accounting for free of cost spare parts, the profit
 after taxation for the current year would have been higher by Rs.
 22.20 million, the gross block of fixed assets would have been higher
 by Rs. 18.97 million and the inventory as at the year end would have
 been higher by Rs.8.75 million.
 
 (m) 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.
 
 (n) Foreign currency transactions
 
 (i) Initial Recognition
 
 Foreign currency transactions are recorded in the reporting currency,
 by applying to the foreign currency amount the exchange rate between
 the reporting currency and the foreign currency at the date of the
 transaction.
 
 (ii) Conversion
 
 Foreign currency monetary items are reported using the closing rate.
 Non-monetary items which are carried in terms of historical cost
 denominated in a foreign currency are reported using the exchange rate
 at the date of the transaction; and non-monetary items which are
 carried at fair value or other similar valuation denominated in a
 foreign currency are reported using the exchange rates that existed
 when the values were determined.
 
 (iii) Exchange Differences
 
 Exchange differences, in respect of accounting periods commencing on or
 after December 7, 2006, arising on reporting of long-term foreign
 currency monetary items at rates different from those at which they
 were initially recorded during the period, or reported in previous
 financial statements, in so far as they relate to the acquisition of a
 depreciable capital asset, are added to or deducted from the cost of
 the asset and are depreciated over the balance life of the asset, and
 in other cases, are accumulated in a Foreign Currency Monetary Item
 Translation Difference Account in the Company''s financial statements
 and amortized over the balance period of such long-term asset /
 liability but not beyond accounting period ending on or before March
 31, 2011.
 
 Exchange differences arising on the settlement of monetary items not
 covered above, or on reporting such monetary items of company at rates
 different from those at which they were initially recorded during the
 year, or reported in previous financial statements, are recognized as
 income or as expenses in the year in which they arise.
 
 (o) Aircraft maintenance costs and engine repairs
 
 Aircraft, Auxiliary Power Unit (''APU'') and Engine maintenance and
 repair costs are expensed as incurred. In cases where such overhaul
 costs in respect of engines / APU are covered by third party
 maintenance agreements, these are accounted in accordance therewith.
 
 (p) Retirement and other employee benefits
 
 Retirement benefit in the form of provident fund is a defined
 contribution scheme and the contributions are charged to the Profit and
 Loss Account of the year when the contributions to the respective fund
 are due. There are no other obligations other than the contribution
 payable to the respective funds.
 
 Gratuity liability under the Payment of Gratuity Act, 1972 is a defined
 benefit obligation and is provided for on the basis of actuarial
 valuation on projected unit credit method made at the end of each
 financial year.
 
 Short term compensated absences are provided for based on estimates.
 Long term compensated absences are provided for based on actuarial
 valuation on projected unit credit method made at the end of each
 financial year.
 
 Actuarial gains / losses are immediately taken to profit and loss
 account and are not deferred.
 
 (q) Taxation
 
 Tax expense comprises current and deferred income taxes. Current income
 tax is measured at the amount expected to be paid to the tax
 authorities in accordance with the Income-tax Act, 1961 enacted in
 India. Deferred income taxes reflects the impact of current year timing
 differences between taxable income and accounting income for the year
 and reversal of timing differences of earlier years.
 
 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 are recognised only to the extent that there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realised. If the Company
 has unabsorbed depreciation or carry forward tax losses, deferred tax
 assets are recognised only if there is virtual certainty supported by
 convincing evidence that such deferred tax assets can be realised
 against future taxable profits.
 
 The carrying amount of deferred tax assets are reviewed at each balance
 sheet date. The Company writes-down the carrying amount of a deferred
 tax asset to the extent that it is no longer reasonably certain or
 virtually certain, as the case may be, that sufficient future taxable
 income will be available against which deferred tax asset can be
 realised.  At each balance sheet date the Company re- assesses
 unrecognised deferred tax assets. It recognises unrecognised deferred
 tax assets to the extent that it has become reasonably certain or
 virtually certain, as the case may be that sufficient future taxable
 income will be available against which such deferred tax assets can be
 realised.
 
 Minimum Alternative Tax (''MAT'') credit is recognised as an asset only
 when and to the extent there is convincing evidence that the company
 will pay normal income tax during the specified period. In the year in
 which the credit becomes eligible to be recognized as an asset in
 accordance with the recommendations contained in Guidance Note issued
 by the Institute of Chartered Accountants of India, the said asset is
 created by way of a credit to the profit and loss account and shown as
 MAT Credit Entitlement. The Company reviews the same at each balance
 sheet date and writes down the carrying amount of MAT Credit
 Entitlement to the extent there is no longer convincing evidence to the
 effect that Company will pay normal Income Tax during the specified
 period.
 
 (r) Cash and cash equivalents
 
 Cash and cash equivalents for the purpose of cash flow statement
 comprise cash at bank and in hand and short-term investments with an
 original maturity of three months or less.
 
 (s) Earnings per Share (EPS)
 
 The earnings considered in ascertaining the Company''s earnings per
 share comprise the net profit or loss after tax attributable to equity
 share holders. The number of shares used in computing basic earnings
 per share is the weighted average number of shares outstanding during
 the year.
 
 The number of shares used in computing diluted earnings per share
 comprises the weighted average number of shares considered for deriving
 basic earnings per share and also the weighted average number of
 shares, if any, which would have been issued on the conversion of all
 dilutive potential equity shares.
 
 (t) Employee stock compensation expenses
 
 Measurement and disclosure of the employee share-based payment plans is
 done in accordance with SEBI (Employee Stock Option Scheme and Employee
 Stock Purchase Scheme) Guidelines, 1999 and the Guidance Note on
 Accounting for Employee Share-based Payments, issued by the Institute
 of Chartered Accountants of India. The Company measures compensation
 cost relating to employee stock options using the intrinsic value as
 applicable to the relevant grant. Compensation expense is amortized
 over the vesting period of the option on a straight line basis.