(A) Basis of Accounting
 
 The financial statements have been prepared to comply in all material
 respects with the mandatory Accounting Standards issued under the
 Accounting Standard Rules,2006 notified by the Central Government and
 the relevant provisions of the Companies Act,1956. The financial
 statements have been prepared under the historical cost convention on
 accrual basis except in case of claims lodged with Insurance Companies
 but not settled and interest on overdue debts from customers which are
 accounted for on receipt basis on account of uncertainties.
 
 (B) Use of Estimates
 
 The preparation of financial statements requires estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities on the date of the financial statements and the reported
 amount of revenues and expenses during the reporting period. Difference
 between the actual results and estimates are recognised in the period
 in which the results are known/ materialised.
 
 (C) Revenue Recognition
 
 (i) Revenue from sales is recognised when the significant risks and
 rewards of ownership of the goods have passed to the buyer, which
 generally coincides with the delivery.
 
 (ii) Revenue (other than sale) is recognised to the extent that it is
 probable that the economic benefits will flow to the Company and the
 revenue can be reliably measured.
 
 (iii) Revenue from process of fabrics are recognised on delivery of the
 goods to customers/when the goods are ready for delivery. When goods
 are partly processed, the expenses so incurred is shown as work- in-
 progress.
 
 (D) 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. The carrying amounts are reviewed at each balance
 sheet date, if there is any indication of impairment based on
 internal/external factors. An impairment loss is recognised wherever
 the carrying amount of an asset exceeds its recoverable amount. The
 recoverable amount is greater of the assets net selling price and value
 in use. In assessing, value in use, the estimated future cash flows are
 discounted to their present value at the weighted average cost of
 capital.
 
 (E) Depreciation
 
 Depreciation on Fixed Assets installed upto 31.3.1992 continues to be
 provided at written down value method and depreciation on assets
 installed on or after 1.4.1992 has been charged at straight line method
 as per the rates and manner prescribed in the Schedule XIV of the
 Companies Act,1956. Depreciation on additions due to Machinery spares
 is provided retrospectively from the date the related assets are put to
 use. Depreciation on additions to or on disposal of assets is
 calculated on pro-rata basis. Leasehold land is being amortised over
 the period of lease tenure. Additions on rented premises are being
 amortised over the period of rent agreement. Software and Designing
 Rights being Intangible Assets are depreciated over five years.
 
 (F) Foreign Currencies
 
 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. Monetary items related to Foreign Currencies transactions
 are restated at year end exchange rates. All exchange differences
 arising from such conversion including gain or loss on cancellation of
 foreign currency forward covers are included in the Profit & Loss
 Account. Premium/Discount on Forward Covers is recognised over the
 length of the contract.
 
 ii) Finished Goods and Work-in-progress have been valued as per the
 principles and basis as in the previous year/consistently followed.  
 
 iii) Provision for obsolete/old inventories is made, wherever 
 required.  
 
 iv) Inter unit transfers of material for further processing is being 
 made at market rate prevailing at the time of such transfers
 and inventories of such “transfers” if any, is also valued accordingly
 as same could not be identified separately and in the opinion 
 of the management such valuation have no material impact on
 inventory valuation. Such stock at the year end are shown as part of 
 raw materials inventory.  
 
 v) In view of substantially large number of items in work- in- 
 progress, it is not feasible to maintain the status of movement
 of each item at shop floor on perpetual basis. The Company, however,
 physically verifies such stocks at the end of every month/ quarter 
 and valuation is made on the basis of such physical verification.
 
 (H) Retirement and other employee benefits
 
 1.  Retirement benefits in the form of Provident Fund and
 Superannuation Scheme, which are defined contribution plans, are
 charged to the Profit & Loss Account of the year when the contributions
 to the respective funds are due.
 
 2.  Gratuity and Leave encashment which are defined benefits, are
 accrued based on actuarial valuation at the balance sheet date carried
 out by an independent actuary using the projected unit credit method.
 
 3.  Gratuity liability is being contributed to the gratuity fund formed
 by the Company.  (I) Excise Duty
 
 Excise duty is paid on clearance of processed fabrics (for work done on
 job basis for outside parties) . No provision for excise duty is made
 in the accounts for fabrics processed (for work done on job basis for
 outside parties ) and lying in factory premises at the end of the year
 as the same is recoverable from the parties.
 
 (J) Investments
 
 Long Term Investments are stated at cost. The Company provides for
 diminution other than temporary in the value of Long Term Investments.
 Current Investments are valued at lower of cost or fair value.
 
 (K) Taxation
 
 Current tax is measured at the amount expected to be paid to the
 revenue authorities, using the applicable tax rates and laws. Deferred
 tax for timing differences between the book and taxable Income for the
 year is accounted for using the tax rates and laws that have been
 enacted or substantively enacted as of the balance sheet date. Deferred
 Tax Assets arising from temporary timing differences are recognised to
 the extent there is reasonable certainty that the assets can be
 realised in future and the same is reviewed at each Balance Sheet date.
 
 MAT Credit is recognized 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 Minimum Alternate
 Tax (MAT) credit becomes eligible to be recognized as an asset in
 accordance with the recommendations contained in Guidance Note issued
 by 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.
 
 (L) Government Grants and Subsidies
 
 Grants and Subsidies from the government are recognised when there is
 reasonable assurance that the grant/subsidy will be received and all
 attaching conditions will be complied with. When the grant or subsidy
 relates to an expense item, it is recognised as income or deducted from
 the relevant expense in the year of sanction of grant or subsidy.
 
 Government Subsidies received/receivable relating to depreciable Fixed
 Assets are being treated as Deferred Income as required by Accounting
 Standard - 12, which are recognised in Profit and Loss Account over the
 useful life of the respective assets.
 
 (M) Borrowing Cost
 
 Borrowing Cost attributable to the acquisition or construction of
 qualifying fixed assets, are capitalised as part of the cost of such
 assets upto the date of commencement of commercial production/put to
 use of plant. Other Borrowing costs are charged to revenue.
 
 (N) Expenditure on new projects , substantial expansion and during
 construction period
 
 Expenditure directly relating to construction activity is capitalised.
 Indirect expenditure incurred during construction period
 is capitalised as part of the indirect construction cost to the extent
 to which the expenditure is indirectly related to
 construction or is incidental thereto. Other indirect expenditure
 incurred during the construction period, which is not related
 to the construction activity nor is incidental thereto is charged to
 the Profit & Loss Account. Income earned during
 construction period is deducted from the total of the indirect
 expenditure.
 
 All direct capital expenditure on expansion is capitalised. As regards
 indirect expenditure on expansion, only that portion is
 capitalised which represents the marginal increase in such expenditure
 involved as a result of capital expansion. Both direct
 and indirect expenditure are capitalised only if they increase the
 value of the asset beyond its originally assessed standard
 of performance.
 
 Expenditure during construction/installation period is included under
 capital work-in-progress and the same is allocated to
 respective Fixed Assets on the completion of its construction.
 
 (O) Provisions
 
 A provision is recognised 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 except those
 disclosed elsewhere in the notes to the financial statements, are not
 discounted to its present value and are determined based on best
 estimate 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.
 
 (P) Derivatives
 
 Outstanding derivatives contracts, other than those covered under
 AS-11, at the year end are Marked to Market Rate, and
 Loss, if any, are accounted for in the Profit & Loss Account. As
 prudent accounting policy, gain on marked to market at the
 end of year are not accounted for.