(a) 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, on going concern basis, and
 in line with accounting standards issued by the Institute of Chartered
 Accountants of India, as applicable, and the provisions of the
 Companies Act, 1956.
 
 (b) Use of Estimates :
 
 The Preparation of financial statements in conformity GAAP requires
 that the Management of the Company makes estimates and assumptions that
 affect the reported amounts of income and expenses of the period, the
 reported balances of assets and liabilities and the assumptions
 relating to contingent liabilities as on the date of the financial
 statements. Examples of such estimates include the useful life of
 tangible and intangible fixed assets, provision for doubtful
 debts/advances, future obligation in respect of retirement benefit
 plans, etc.  Difference, if any, between the actual results and
 estimates is recognized in the period in which the results are known.
 
 (c) Revenue Recognition :
 
 The Company recognizes revenue on the sale of products when the
 products are despatched to the customer or when delivered to the ocean
 carrier for export sales, which is when risks and rewards of ownership
 are passed to the customer.
 
 1.02 Foreign Currency Loans/Transactions:
 
 (a) Import Transactions :
 
 (i) Material imports are accounted at the custom exchange rates
 prevailing at the time of receipts. In case foreign exchange is
 covered, the exchange rate contracted is recognized as a part of
 purchase cost.  Exchange Fluctuations, if any, at the time of
 retirement, are appropriately accounted as a part of material
 (purchase) cost. Similarly Bills Payable (balances) at year end are
 accounted at exchange rate prevailing at year end (as per revised AS -
 11).
 
 (ii) Import contracts covered by ‘foreign exchange cover'' with banks
 are booked at contracted rates. Income / Expenditure incurred in
 cancellation of forward cover contracts, mainly due to variation in the
 bank involved / date of execution are treated as part of purchase cost.
 
 (b) Export Transactions :
 
 (i) Export transactions are accounted at the custom exchange rates
 prevailing at the time of shipments.
 
 Exchange fluctuations, if any, at the time of realisation are
 appropriately accounted.
 
 (ii) Exports, contracts covered by foreign exchange ‘cover'' with banks,
 are booked at contracted rates.  Income / expenditure incurred in case
 of cancellation of forward cover contracts, mainly due to variation in
 bank involved/date of execution are treated as export realisation.
 
 (iii) In case receipt of Export Advances, exchange rates prevailing on
 date of receipts (of advances) is treated as relevant exchange rate
 (for exports).
 
 (c) (i) Foreign Currency Term Loan Contracts, covered by Foreign
 Exchange Swaps are booked at contracted rates.
 
 (ii) Other Foreign Currency Term Loans (balances) are accounted at
 Exchange Rate prevailing at the year end; and such gain / loss is
 considered as finance cost.
 
 (d) Such gain / loss in transactions referred in para (c) above, and
 other foreign currency contracts and / or derivative contracts and
 relevant exchange gain/loss there to, are considered as finance cost.
 
 1.03 Interest on Term Loans, Premium on redemption of Debentures /
 Debts:
 
 (i) Pursuant to the Reschedule / Realignment Scheme, interest payable
 during 2000-2009 financial years is lower than the average interest
 rate during 2000-2014 financial years. The company is treating interest
 payable (yearly rate) as interest accrued.
 
 (ii) On reschedulement and realignment of term debts, financial cost
 incurred is treated as accrued on date of realignment of realigned term
 debts and provided in the relevant financial year.
 
 1.04 Employee Benefits :
 
 A.  Short Term Employee Benefits :
 
 All employee benefits payable / available within 12 months of rendering
 the services are classified as short term employee benefits. Benefits
 such as salaries, wages, bonus etc, are recognized in the Profit & Loss
 Account in the period in which the employee renders the related
 services.
 
 B.  Long Term Employee Benefits :
 
 (i) The Company has taken Group Gratuity Policy with the Life Insurance
 Corporation of India (LIC) for future payment of Gratuities.
 
 Any deficit in Plan Assets managed by LIC and as compared to the
 Actuarial Liability is recognized as a liability immediately.
 
 (ii) Leave Encashment benefit shall be accrued at the year end.
 
 1.05 The Treatment of Expenditure during Construction Period :
 
 (a) Expenditure directly related to particular fixed assets is
 capitalized to those fixed assets. All indirect expenses are
 apportioned to various fixed assets on a reasonable basis. This is done
 once the construction and erection work is completed, pending which the
 accumulated amount is disclosed as Capital Work-in- progress Pending
 capitalization under fixed asset.
 
 (b) Interest on Loans are capitalised upto the date on which the asset
 is ‘Put to Use''. Interest includes exchange fluctuation on Foreign
 Currency Term Loans.
 
 It is in line with Accounting Standards on Borrowing Cost and long term
 foreign currency debts and Accounting Standards on Fluctuation on
 Foreign Exchange currency.
 
 (c) The Income and Expenditure during trial runs is included in the
 Profit & Loss Account. Excess of expenditure over income is
 capitalised.
 
 (d) Temporary surplus in short term i.e. liabilities over assets are
 used for Capital Work In Progress. Interest and consequential cost is
 appropriately accounted / reimbursements.
 
 (e) Upfront Expenses incurred on mobilisation of term debts is treated
 as a part of Capital Cost of relevant project.
 
 1.06 Fixed Assets and Depreciation :
 
 (a) Fixed assets are carried at cost less accumulated depreciation.
 
 (b) Cost excludes Cenvat credit, sales tax and service tax credit and
 such other levies / taxes. Depreciation on such assets is claimed on
 ‘reduced'' cost.
 
 (c) Depreciation on fixed assets has been provided on straight line
 method at the rates specified, in the Schedule XIV of the Companies
 Act, 1956, in Line with Notification No. GSR/756(E) dated, 16th
 December, 1993.
 
 (d) Depreciation on assets acquired during the year has been provided
 on pro-rata basis; from the date on which it is ‘Put to Use''.
 
 1.06 A.  Impairment of Assets :
 
 Fixed Assets are reviewed for impairment whenever events or changes in
 circumstances warrant that the carrying amount of an asset may not be
 recoverable. Recoverability of assets to be held and used is measured
 by a comparison of the carrying amount of an asset to future net
 discounted cash flows expected to be generated by the asset. If such
 assets are considered to be impaired, the impairment to be recognised
 is measured by the amount by which the carrying amount of the asset
 exceeds the fair value of the asset.
 
 1.07 Investment :
 
 The company does not provide for temporary diminution in value of long
 term investments, if any. Exchange Gain / (Loss) on Investments in
 Foreign Currency has been provided at the year end.
 
 1.08 Inventories :
 
 (a) Inventories are valued as under after providing for obsolescence :
 
 (i) Raw Materials — At Cost (Moving Weighted Average Method)
 
 (ii) Work-in-Process — At Material Cost plus labour and other
 appropriate portion of production and administrative overheads 
 and depreciation.  
 
 (iii) Finished Goods — At lower of cost or realisable value.
 Cost is inclusive of any taxes and duties incurred.  
 
 (iv) Stores spares etc.— At Cost (v) Arisings — At realisable value
 
 (b) (i) Raw-materials include stock-in-transit and goods lying in
 Bonded Warehouses .
 
 (ii) Finished goods include stock-in-transit at Docks awaiting Shipment
 and stocks with consignees.  (iii) Inventory includes goods lying with
 third party / job workers / consignees.
 
 1.09 Provision for Taxation :
 
 Income tax expense is the aggregate amount of Current tax, Wealth Tax &
 Deferred Tax. Current year taxes are determined in accordance with the
 provisions of Income Tax Act, 1961 and Wealth Tax Act.  Deferred tax
 charged or credit reflects the tax effect of timing differences between
 accounting income and taxable income for the period. The deferred tax
 charged or credit and the corresponding deferred tax liability or
 assets are recognized using the tax rates that have been enacted or
 substantively enacted by the balance sheet dates.
 
 1.10 Earning per Share :
 
 The Company reports basic and diluted earning per share in accordance
 with AS-20 ‘Earning per Share'' issued by the ICAI. Basic earning per
 share is computed by dividing the net profit after tax by the weighted
 average number of shares outstanding for the year.
 
 1.11 Accounting for Provisions, Contingent liabilities and Contingent
 Assets :
 
 (a) In conformity with AS-29, ‘Provisions, Contingent Liabilities and
 Contingent Assets'', issued by the Institute of Chartered Accountants of
 India. The Company recognizes provisions only when it has a present
 obligation as a result of a past event, it is probable that an outflow
 of resources embodying economic benefits will be required to settle the
 obligation, and when a reliable estimate of the amount of the
 obligation can be made.
 
 (b) No provision is recognised for :
 
 (i) Any possible obligation that arises from past events and the
 existence of which will be confirmed only by the occurrence or
 non-occurrence of one or more uncertain future events not wholly within
 the control of the Company; or
 
 (ii) Any present obligation that arises from past events but is not
 recognised because:
 
 (1) It is not probable that an outflow of resources embodying economic
 benefits will be required to settle the obligation; or
 
 (2) A reliable estimate of the amount of obligation cannot be made.
 
 Such obligations are recorded as Contingent Liabilities. These are
 assessed at regular intervals and only that part of the obligation for
 which an outflow of resources embodying economic benefits is probable,
 is provided for, except in the extremely rare circumstances where no
 reliable estimate can be made.
 
 (iii) Contingent Assets are not recognised in the financial statements
 as this may result in the recognition of income that may never be
 realised.
 
 1.12 Export entitlements / obligations :
 
 (a) Duty free import of raw materials under Advance Authorisation
 (DEEC) for imports as per import and export policy are matched with
 exports made / produced. Benefit / Obligation are accounted by making
 suitable adjustments in raw material consumption.
 
 (b) The benefits accrued under the Duty Entitlement Pass Book Scheme
 (DEPB) and Duty Free Import Authorisation (DFIA) as per the relevant
 import and export policies during the year are included under the head:
 
 (i) Sales : Export incentives
 
 (ii) Raw material consumed
 
 (iii) Stores & Rolls consumed
 
 (c) Export incentives receivable on export performance are recognised
 in pursuance to ‘Accounting Standard 9 on Revenue Recognition'', (AS-9)
 with reference to certainty of collectability of such export
 incentives.
 
 1.13 (a) Sales are recognised at the time of despatch to customers/
 endorsement of documents and includes Central
 
 Excise Duty; as may be applicable.
 
 (b) Finished goods captively consumed as packing materials are excluded
 from sales. Transfer Price, as taken in Central Excise Duty records, is
 treated as the packing material cost.
 
 1.14 Deferred sales tax incentive available to the Company under
 Maharashtra Value Added Tax (MVAT) is recognised as sales in case Net
 present value (NPV) is duly paid to the designated authority before the
 approval of annual accounts.
 
 1.15 C. R. Coils Production excludes C.R. baby coils produced.
 
 1.16 Customs Duty :
 
 The Company has been accounting for custom duty liability, as may be
 applicable, in respect of imported raw material lying in bonded
 warehouse as and when they are ex-bonded.
 
 1.17 Central Excise Duty and Service Tax :
 
 (a) The Company is accounting liability for excise duty on finished
 goods as and when goods are cleared as per consistent practice, in
 pursuance to the accepted practice of the Excise authorities.
 
 (i) Inventory valuation
 
 (1) Finished goods in the plant at the close of the year are valued
 inclusive of excise duty.
 
 (2) Raw materials and work in process are valued exclusive of Cenvat
 claimed.
 
 (ii) Profit / Loss for the year remain unaffected by inclusion /
 exclusion of Excise Duty in inventory valuation referred in clauses (1)
 and (2) above.
 
 (b) The Company is accounting liability for Service Tax for services
 purchased, at the time of payment. The credit for Input Services Tax is
 claimed as per appropriate laws, rules and regulations.
 
 1.18 Commodity Hedging Transactions :
 
 In respect of commodity hedging transactions, the gain / loss on
 settlement and provisions for gain / losses at year end are
 appropriately accounted along with material cost.
 
 1.19 Inter Unit transactions are eliminated to the extent possible B.