Under statement of Accounting Policies
 
 1. The company has been consistently following the accrual method in
 accounting its income and expenses.  The same procedure is followed
 this year also.  The accounting is on the basis of a going concern
 concept only.
 
 2. There is no Research and Development activity by the company and the
 allocation of amounts of the cost specifically attributable to research
 and development does not arise.
 
 3. Revenue from sale transactions is recognised as and when the
 property in the goods sold is transferred to the buyer for a definite
 consideration.  Revenue from service transactions and other sources is
 recognised on the completion of the contract and there is no
 uncertainity regarding the amount of consideration of collectibility.
 
 4. a) Sales as reported is exclusive of Excise Duty, Sales tax,
 Insurance and Transport charges.
 
 b) Export Sales are accounted for at the rate prevailing on the date on
 which transaction takes place.  Gain or Loss arising out of exchange
 rate fluctuation is recognised and accounted for on the date of
 realisation.
 
 5. Depreciation on revalued assets has been deducted from the
 revaluation reserve.
 
 6. The cost of fixed assets is shown at historical cost except land and
 building which are shown at the revaluation amount.
 
 7. a) Depreciation has been calculated at the rare specified in
 Schedule XIV of the said act as amended by the Circular No. 14 Dt.
 16.12.1993 by the Department of Company Affairs as follows:
 
 Written Down Value Method upto 30.06.1964 and 01.04.1966 to 31.03.1970
 for Machinery and Electric Machinery.  Straight Line Method from
 01.04.1964 to 31.03.1966 and 01.04.1970 onwards.  All other assets
 other than machinery and electric machinery Written Value Method.
 
 For Machinery and Electrical machinery at the rate applicable for
 continuous process plant from 01.04.1993.
 
 b) In respect of all assets purchased or sold during the year
 depreciation has been provided at the above rates on prorata basis from
 the date of purchase including all assets even if the cost is below
 Rs.5,000/- or till the date of sale as the case may be
 
 8. Inventories :
 
 Stock of stores of weighted average cost, FIFO Raw materials, Mixing
 and process and Finished Goods at Cost or Net Realisable Value which
 ever is lower and waste at Residual Price.
 
 9. The value of modvat benefit eligible has been reduced from the value
 of materials and the consumption of materials has been arrived
 accordingly and the value of modvat benefit eligible in respect of
 capital item is being reduced from the value of capital goods.
 
 10. Investments are shown at cost less any permanent diminution in
 value interest received on investments and dividend will be accounted
 in receipt basis.
 
 11. It is the policy of the company to amortise expenditure incurred on
 Sales promotion, voluntary retirement compensation, Advertisement,
 public, Preference Shares expenses for the period of over 10 years.
 
 12. Drafting Materials have been capitalised and depreciation have been
 written-off the capitalised value materials considered for
 capitalisation have a enduring benefit for a period of more than five
 years.