1.  Basis of Preparation of Financial Statements
 
 a.  The financial statements have been prepared under the historical
 cost convention in accordance with the Generally Accepted Accounting
 Principles (GAAP) and are in consonance with the mandatory accounting
 standards and statements issued by the Institute of Chartered
 Accountants of India and the provisions of the Schedule VI of the
 Companies Act, 1956.  Accounting policies not specifically referred to
 otherwise are consistent with generally accepted accounting principles.
 
 b.  The Company follows the mercantile systems of accounting and
 recognizes income and expenditure on an accrual basis except stated
 otherwise.
 
 2.  Revenue Recognition
 
 a.  Sales are recognized when goods are supplied and are recorded net
 of sales return, rebates, trade discounts VAT/Central Sales Tax and
 excise duty.
 
 b.  Income from Services rendered are booked based on
 agreements/arrangements with the concerned parties and recognized on
 proportionate completion service contract method.
 
 3.  Use of Estimates
 
 In preparation of financial statements estimates and assumptions are
 required to be made which affect the reported amounts of
 assets/liabilities on the date of financial statements and the reported
 amounts of revenues and expenses during the reporting period. The
 differences between estimates and actual are recognized in the period
 in which results are crystallized.
 
 4.  Fixed Assets
 
 Fixed Assets are stated at historical cost. Cost includes freight,
 installation cost, duties, taxes, and incidental expenses but net of
 Excise duty (CENVAT) and VAT (ITR).
 
 5.  Depreciation
 
 Depreciation is charged on Straight Line Method at the rate prescribed
 under Schedule XIV of the Companies Act, 1956
 
 6.  Borrowing Cost
 
 Borrowing Cost attributable to acquisitions and construction of assets
 are capitalized as a part of cost of such assets up to the date when
 such assets are ready for its intended use and other borrowing cost are
 charged to Profits Loss Account.
 
 7.  Inventories
 
 a.  Raw Materials, Stores & Spares, Finished Goods are valued at cost
 or net realizable value whichever is lower. Reusable Waste is valued at
 net realizable value.
 
 b.  Raw Material and Finished goods are valued net of excise duty.
 However Finished Goods at branches are valued at inclusive of excise
 duty and freight.
 
 c.  Goods or materials in transit are valued at cost to date.
 
 d.  Cost comprises cost of purchase, cost of conversion and other cost
 incurred in bringing the inventory to present location and condition.
 Cost is arrived at weighted average basis.
 
 8.  Insurance Claims:
 
 Insurance Claims for Stocks Lost by Fire are accounted on the basis of
 Lodgments of claims with the respective Insurance Company. Differences
 between Insurance Claims accounted for and actual receipt are accounted
 as Miscellaneous Expenditure/Income in the year of Settlement.
 
 9.  Foreign Currency Transactions:
 
 Foreign currency transactions are accounted for at the exchange rates
 prevailing at the date of the transaction. Gains and losses resulting
 from the settlement of such transactions and from the translation of
 monetary assets and liabilities denominated in foreign currencies are
 recognized in the profit and loss account.
 
 10.  Retirement Benefits
 
 Contribution to Provident Fund and ESIC are deposited with respective
 Government Authorities.  The provision for Gratuity Liability is made
 on basis of actuarial valuation by the LIC of India.
 
 11.  Taxation
 
 Current Tax is determined as the amount of tax payable in respect of
 taxable income for the year.  Deferred tax is recognized, subject to
 consideration of prudence in respect of deferred tax assets, on timing
 difference between taxable income and accounting income that originate
 in one period and are capable of reversal in one or more periods.
 
 12.  Impairment of Assets
 
 The Company assesses at each Balance Sheet date whether there is any
 indication that an asset may be impaired. If any such indication
 exists, the Company estimates the recoverable amount of the asset. If
 such recoverable amount of the asset or the recoverable amount of the
 cash generating unit to which the asset belongs is less than its
 carrying amount, the carrying amount is reduced to its recoverable
 amount. The reduction is treated as an impairment loss and is
 recognized in the Profit and Loss account. If at the Balance Sheet date
 there is an indication that if a previously assessed impairment loss no
 longer exists, the recoverable amount is reassessed and the asset is
 reflected at the recoverable amount.
 
 13. Provisions and Contingent Liabilities
 
 Provisions involving substantial degree of estimation in measurement
 are recognized when there is apermanent obligation as a result of past
 events and it is probable that there will be an outflow of resources.
 Contingent Liabilities are not recognized but are disclosed in the
 notes.
 
 14. Miscellaneous Expenditure
 
 Preliminary Expenditure is amortized over a period of 5 years.