1.1 Basis of Accounting
 
 The financial statements are prepared under the historical cost
 convention on accrual basis of accounting, in accordance with the
 generally accepted accounting principles in India, and the relevant
 provisions of the Companies Act, 1956 including accounting standards
 notified there under.
 
 1.2 Use of Estimates
 
 In preparing the financial statements in conformity with accounting
 principles generally accepted in India, management is required to make
 estimates and assumptions that affect the reported amounts of assets
 and liabilities and the disclosure of contingent liabilities as at the
 date of financial statements and the amounts of revenue and expenses
 during the reported period. Actual results could differ from those
 estimates. Any revision to such estimates is recognised in the period
 the same is determined.
 
 1.3 Fixed Assets
 
 Fixed assets are stated at cost of acquisition less depreciation,
 except land gifted by the State Governments, which is stated at
 notional/nominal value with corresponding credit to capital reserve.
 
 Expenditure on development of land, including leasehold land, is
 capitalised as part of cost of land. Cost of Lease hold land is
 amortised over the period of lease.
 
 Cost includes all identifiable expenditure including trial-run
 expenses, net of revenue.
 
 Assets retired from active use are shown separately under fixed assets
 at lower of net book value and estimated realisable value.
 
 Mining rights are treated as intangible assets and all the related
 costs thereof are amortised over the period (including deemed renewal)
 of the lease.
 
 Software which is not an integral part of related hardware, is treated
 as intangible asset and amortised over a period of five years or its
 licence period, whichever is less.
 
 1.4 Borrowing Costs
 
 Borrowing costs attributable to the acquisition or construction of a
 qualifying asset are capitalised as part of the cost of that asset.
 Other borrowing costs are recognised as expense in the period in which
 these are incurred.
 
 1.5 Depreciation
 
 Depreciation is provided on straight-line method at the rates specified
 in Schedule XIV to the Companies Act, 1956. However, where the
 historical cost of a depreciable asset undergoes a change, the
 depreciation on the revised unamortised depreciable amount is provided
 over the residual useful life of the asset. Classification of plant and
 machinery into continuous and non- continuous is made on the basis of
 technical opinion and depreciation provided accordingly. Depreciation
 on addition/deletion during the year is provided on pro-rata basis with
 reference to the month of addition/deletion.
 
 1.6 Investments
 
 Long-term investments (including investments in subsidiary companies
 and joint ventures) are carried at cost, after providing for
 diminution, other than temporary, in value. Current investments are
 carried at lower of cost and market value.
 
 1.7 Inventories
 
 Raw materials, stores & spares and finished/semi-finished products
 (including process scrap) are valued at lower of cost and net
 realisable value of the respective plants/units. In case of identified
 obsolete/ surplus/ non-moving items, necessary provision is made and
 charged to revenue. The net realisable value of semi-finished special
 products, which have realisable value at finished stage only, is
 estimated for the purpose of comparison with cost.
 
 Residue products and other scrap are valued at estimated net realisable
 value.
 
 The basis of determining cost is:
 
 Raw materials - Periodical weighted average cost
 
 Minor raw materials - Moving weighted average cost
 
 Stores & spares - Moving weighted average cost
 
 Materials in-transit - at cost
 
 Finished/Semi-finished products - material cost plus appropriate share
 of labour, related overheads and duties.
 
 1.8 Grants
 
 Grants relating to the acquisition of a specific asset are adjusted
 against the cost of the concerned asset. Grants relating to the revenue
 expenditure are adjusted against the related expenses.
 
 1.9 Voluntary Retirement Compensation
 
 Expenditure on voluntary retirement compensation, is charged off in the
 year, in which it is incurred.
 
 1.10 Foreign Currency Transactions
 
 Monetary assets and liabilities related to foreign currency
 transactions remaining unsettled are translated at year-end rates.
 
 The difference in translation of monetary assets and liabilities and
 realised gains and losses on foreign exchange transactions other than
 those relating to fixed assets, are recognised in the profit and loss
 account. In respect of transactions covered by forward exchange
 contracts, the difference between the contract rate and spot rate on
 the date of the transaction is recognised in the profit and loss
 account over the period of the contract.
 
 The company had opted for accounting the exchange differences arising
 on reporting of long term foreign currency monetary items in line with
 Companies (Accounting Standards) Amendment Rules 2009 relating to
 Accounting Standard -11 notified by Government of India on 31st March,
 2009. Accordingly, exchange differences (including arising out of
 forward exchange contracts) relating to long term monetary items,
 arising during the year, in so far as they relate to the acquisition of
 fixed assets, are adjusted in the carrying amount of such assets.
 
 1.11 Employees'' Benefits
 
 Contributions towards Provident Funds are charged to the Profit and
 Loss Account of the period when the contributions to the Funds are due.
 The provisions/liabilities towards gratuity, accrued leave, long term
 service awards, post-retirement medical and settlement benefits, future
 payments to the disabled employees/legal heirs of deceased employees
 under the Employees'' Family Benefit Scheme, are made based on the
 actuarial valuation as at the end of the year and charged to the profit
 and loss account after considering along with actuarial gains/losses.
 
 1.12 Adjustments pertaining to earlier years and prepaid expenses
 
 Income / expenditure relating to prior period and prepaid expenses,
 which do not exceed Rs.5 lakhs in each case, are treated as
 income/expenditure of current year.
 
 1.13 Revenue Recognition
 
 Sales include excise duty and are net of rebates and price concessions.
 Sales are recognised at the time of dispatch of materials to the buyers
 including the cases where delivery documents are endorsed in favour of
 the buyers Where the contract prices are not finalised with government
 agencies, sales are accounted for on provisional basis.  Marine export
 sales are recognised on:
 
 i) the issue of bill of lading, or
 
 ii) negotiation of export bills upon expiry of laycan period , in cases
 where Rs.realisation of material value without shipment'' is provided in
 the letters of credit of respective contracts, whichever is earlier.
 
 Export incentives under various schemes are recognized as income on
 certainty of realisation.  The iron ore fines not readily
 useable/saleable included in inventory, are recognised on disposal.
 
 1.14 Claims for Liquidated Damages/Price Escalation
 
 Claims for liquidated damages are accounted for as and when these are
 deducted and/or considered recoverable by the Company. These are
 adjusted to the capital cost or recognised in profit and loss account,
 as the case may be, on final settlement.
 
 Suppliers''/Contractors'' claims for price escalation are accounted for,
 to the extent such claims are accepted by the Company.
 
 1.15 Deferred Tax
 
 The deferred tax on timing differences between book profit and taxable
 profit for the year is accounted for applying the tax rates and laws
 that have been enacted or substantively enacted as on the balance sheet
 date. Deferred tax assets arising from timing differences are
 recognised to the extent there is a reasonable certainty that the
 assets can be realised in future.
 
 1.16 Overburden Removal
 
 The expenditure on removal of backlog of over burden is charged to
 revenue, based on stripping ratio as per 5 year mining plan for mines
 except collieries which is based on project report.