1.    ACCOUNTING METHODOLOGY
 
 The accounts have been prepared on historical cost basis of accounting,
 on an accrual basis and comply with the Accounting Standards referred
 in Section 211 (3C) of the Companies Act, 1956, to the extent
 applicable. All expenses and income to the extent considered payable
 and receivable with reasonable certainty are accounted for on accrual
 basis. Accounting policies not specifically referred to are consistent
 with generally accepted accounting practices.
 
 2.  USE OF ESTIMATES
 
 The presentation of financial statements in conformity with Generally
 Accepted Accounting Principles (GAAP) requires management to make
 estimates and assumptions that affects the reported amounts of assets
 and liabilities, and the disclosures of contingent liabilities on the
 date of the financial statements. Actual results could differ from
 those estimates.  Any revision to accounting estimates is recognized
 prospectively.
 
 3.  REVENUE RECOGNITION
 
 Revenue from sale of goods is recognized when significant risks and
 rewards of ownership are transferred to the Customers. Sales are net of
 sales return and trade discounts.
 
 4.  FIXED ASSETS
 
 a) Fixed Assets are carried at cost/book value and include amount added
 on revaluation. Depreciation is provided on revalued cost of assets
 (excluding land) on Straight Line Method, at rates prescribed under
 Schedule XIV of the Companies Act, 1956. Cost of leasehold land/land
 development is being amortised over the period of the lease. In respect
 of additions to fixed assets, depreciation is being calculated on
 pro-rata basis from the month of such addition.
 
 b) Depreciation on Assets is provided as per Straight Line Method.
 
 c) Financial Leases - Assets under hire purchase are capitalised and
 depreciated as per estimated useful life of the asset.
 
 5.  IMPAIRMENT OF ASSETS
 
 In accordance with AS 28 on ''Impairment of Assets'' issued by the
 Institute of Chartered Accountants of India, where the impairment of
 the Company''s assets related to cash generating units, the carrying
 amounts of such assets are reviewed at each balance sheet date to
 determine whether there is any impairment. The recoverable amount of
 such assets is estimated as the higher of its net selling price and its
 value in use. An impairment loss is recognized whether the carrying
 amount of such assets exceeds its recoverable amount impairment loss is
 recognized in the profit and loss account.  Impairment, if any, will be
 recognized in the accounts in the year in which an asset is identified
 as impaired.
 
 6.  INVENTORIES
 
 Inventories are valued at lower of cost and estimated net realisable
 value. Valuation of finished goods represents direct cost and an
 appropriate portion of factory overheads which are incurred in bringing
 them to their present location and conditions and includes Central
 Excise Duty payable. . Weighted Average method is used for
 determination of cost.
 
 7.  TAXATION
 
 a) Income tax expense comprise current tax and fringe benefit tax (i.e.
 amount of tax for the period determined in accordance with the income
 tax law) and deferred tax charge or credit (reflecting the tax effects
 of timing differences between accounting income and taxable income for
 the year)
 
 b) The deferred tax charge or credit and the corresponding deferred tax
 liabilities or assets are recognised using the tax rates that have been
 enacted or substantively enacted by the balance sheet date.
 
 c) 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
 including asset arising from unabsorbed depreciation and losses carried
 forward, is not recognised unless there is virtual certainty that
 sufficient future taxable income will be available against which
 deferred tax can be realised.
 
 8.  EMPLOYEE BENEFITS
 
 a) Gratuity:
 
 Liability under the payment of Gratuity Act, 1972 is a defined benefit
 obligation and is provided for on the basis of the actuarial valuation
 made at the end of each financial year.
 
 b) Provident Fund:
 
 Retirement benefits in the form of Provident Fund / Pension 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 funds are due. There are no other obligations other than the
 contribution payable to the respective funds.
 
 c) Leave Entitlement:
 
 Liability towards Leave Entitlement Benefit is provided for as at the
 Balance Sheet date as per the actuarial valuation taken at the end of
 the year.
 
 Actuarial gains/ losses are immediately taken to Profit and Loss
 account and are not deferred.
 
 9.  TRANSACTION OF FOREIGN CURRENCY ITEMS
 
 a) Foreign Currency transactions are recorded at the rate of exchange
 prevailing on the date of the transaction.
 
 b) Foreign Currency transactions remaining unsettled as on the last day
 of the financial year are translated at the exchange rate prevailing as
 on the date of Balance Sheet. The resultant difference, if any, is
 dealt with in the Profit and Loss Account. Premium in respect of
 forward exchange contracts is recognised over the life of the
 contracts.
 
 10. BORROWING COSTS
 
 Borrowing costs attributable to acquisition and construction of
 qualifying asset are capitalized as a part of the date when such asset
 is ready for its intended use. A qualifying asset is one that
 necessarily takes substantial period of time to get ready for intended
 use. All other borrowing costs are charged to the Profit and Loss
 Account.
 
 11.  PROVISIONS AND CONTINGENT LIABILITIES
 
 The Company recognises a provision when there is a present obligation
 as a result of a past event that probably requires an outflow of
 resources and a reliable estimate can be made of the amount of the
 obligation. A disclosure for a contingent liability is made when there
 is a possible obligation or a present obligation that may, but probably
 will not, require an outflow of resources. Where there is possible
 obligation or a present obligation that the likelihood of outflow
 resources is remote, no provision or disclosure is made.