(i) The accounts are prepared on historical cost convention on accrual
 basis of accounting and comply with the Accounting Standards as notifed
 under the Companies (Accounting Standards) Rules, 2006.
 
 The preparation of the accounts requires the Management to make
 estimates and assumptions considered in the reported amounts of assets
 and liabilities (including the contingent liabilities) and the reported
 income and expenses during the period. The Management believes that the
 estimates used in preparation of the accounts are prudent and
 reasonable. Future results could difer from these estimates and the
 diferences between the actual results and the estimates are recognised
 in the periods in which the results are known / materialise.
 
 (ii) SALES AND SERVICES
 
 (a) Sales exclude sales tax, value added tax and works contract tax but
 include excise duty. Commission earned on consignment sales is
 accounted for as part of sales and services.
 
 (b) Revenue from sale of goods is recognised when the substantial risks
 and rewards of ownership are transferred to the buyer under the terms
 of contract. Service revenue is recognised on rendering of services.
 
 (c) Revenue from long-term contracts, where the outcome can be
 estimated reliably, is recognised under the percentage of completion
 method by reference to the stage of completion of the contract
 activity. The stage of completion is measured by calculating the
 proportion that costs incurred to date bear to the estimated total
 costs of a contract. When the current estimate of total costs and
 revenue is a loss, provision is made for the entire loss on the
 contract irrespective of the amount of work done. Contract revenue
 earned in excess of billing has been reflectedunder Other Current
 Assets and billing in excess of contract revenue has been refected
 under Current Liabilities in the balance sheet.
 
 (d) Long-Term Annual Maintenance Contracts :
 
 The revenue from maintenance contracts is recognised on accrual basis
 and advance received in respect of future period is accounted for as
 Unexpired Service Revenue.
 
 In case of Mining Equipment, the revenue from such contracts is
 recognised in proportion to the cost actually incurred during the year
 in terms of the total estimated cost for such contracts, as repairs and
 maintenance of such machineries depends on its utilisation and wear and
 tear which varies from year to year. The excess of billings over cost
 is deferred and accounted for as Unexpired Service Revenue.
 
 (iii) JOINT VENTURES
 
 The accounts of the Company refect its share of the Assets,
 Liabilities, Income and Expenditure of the Joint Venture Operations
 which are accounted on the basis of the audited accounts of the Joint
 Ventures on line-by-line basis with similar items in the Company''s
 accounts to the extent of the participating interest of the Company as
 per the Joint Venture Agreements.
 
 (iv) DEPRECIATION / AMORTISATION
 
 Depreciation on all fixed assets has been provided on the Straight Line
 Basis at the rates prescribed in Schedule XIV to the Companies Act,
 1956, except Depreciation on furniture and fttings, which has been
 provided on the Written Down Value Basis at the rates prescribed in
 Schedule XIV to the Companies Act, 1956.
 
 Intangible assets are amortised on the Straight Line Basis over their
 useful life. Manufacturing Rights and Technical Know-how have been
 amortised over 72 months and Software is amortised over 60 months.
 
 Premium paid on Leasehold Land is amortised over the period of the
 lease, commencing from the date the land is put to use for commercial
 operations.
 
 (v) PROVISION FOR TRADE GUARANTEES
 
 Provision for estimated costs to be incurred in providing warranty
 services is made in the accounts in the year in which the goods are
 sold or the construction contract is completed.
 
 (vi) FIXED ASSETS
 
 Fixed assets are stated at cost less accumulated depreciation /
 impairment.
 
 Own manufactured goods are capitalised at cost excluding interest but
 including excise duty net of CENVAT, octroi duty and receiving /
 installation charges.
 
 Interest on borrowed money allocated to and utilised for qualifying
 fixed assets pertaining to the period upto the date of capitalisation is
 added to the cost of the assets.
 
 Assets acquired under finance leases are recognised at the lower of the
 fair value of the leased assets at inception and the present value of
 minimum lease payments. Lease payments are apportioned between the
 finance charge and the outstanding liability. The finance charge is
 allocated to periods during the leased term at a constant periodic rate
 of interest on the remaining balance of the liability.
 
 (vii) INTANGIBLE ASSETS
 
 Intangible assets are stated at cost less accumulated amortisation.
 
 (viii) IMPAIRMENT OF ASSETS
 
 The carrying values of assets / cash generating units at each Balance
 Sheet date are reviewed for impairment of assets. If any indication of
 such impairment exists, the recoverable amount of such assets is
 estimated and impairment is recognised if the carrying amount of these
 assets exceeds their recoverable amount. The recoverable amount is the
 greater of the net selling price and their value in use. Value in use
 is arrived at by discounting the future cash flows to their present
 value based on an appropriate discount factor. When there is indication
 that an impairment loss recognised for an asset in prior accounting
 periods no longer exists or may have decreased, such reversal of
 impairment loss is recognised.
 
 (ix) PROVISIONS AND CONTINGENCIES
 
 A provision is recognised when the Company has a present legal or
 constructive obligation as a result of past events and it is probable
 that an outflowof resources will be required to settle the obligation
 in respect of which a reliable estimate can be made. Provisions
 (excluding retirement benefits) are not discounted to their 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 refect the current best estimates.
 Contingent liabilities are disclosed in Notes to Accounts.
 
 (x) INVESTMENTS
 
 Long-term investments are carried at cost less provision for any
 diminution other than temporary, in the value of such investments.
 
 Current investments are carried at the lower of cost and fair value.
 
 (xi) INVENTORIES
 
 Inventories including Work-in-Progress (other than Construction
 Contracts) are valued at cost or net realisable value, whichever is
 lower, cost being worked out on weighted average basis. Cost includes
 all charges for bringing the goods to the point of sale, including
 octroi and other levies, transit insurance and receiving charges.
 
 (xii) TAXES ON INCOME
 
 Current Tax is the amount of the tax payable on the taxable income for
 the year as determined in accordance with the provisions of the Income
 Tax Act, 1961.
 
 Deferred Tax is recognised on timing diferences, being the diferences
 between the taxable income and the accounting income that originate in
 one period and are capable of reversal in one or more subsequent
 periods.
 
 Deferred Tax Assets in respect of unabsorbed depreciation and carry
 forward of losses are recognised if there is virtual certainty that
 there will be suficientfuture taxable income available to realise such
 losses. Other Deferred Tax Assets are recognised if there is reasonable
 certainty that there will be suficientfuture taxable income to realise
 such assets. Deferred tax assets are reviewed at each Balance Sheet
 date for their realisability.
 
 (xiii) FOREIGN EXCHANGE TRANSACTIONS / TRANSLATIONS
 
 (a) The foreign branches of the Company have been classifed as
 integral foreign operations. Revenue transactions (other than
 depreciation) of the foreign branches are incorporated in the Company''s
 accounts at the average exchange rate during the year, fixed assets are
 incorporated at the spot rate of the date of acquisition and current
 assets and liabilities are translated at the rates of exchange
 prevailing on the date of the Balance Sheet. Depreciation is translated
 at the average rate.
 
 (b) Monetary assets and liabilities relating to foreign currency
 transactions remaining unsettled at the end of the year are translated
 at the year-end rate and the diference in translation and realised
 gains and losses on foreign exchange transactions are recognised in the
 profit and Loss Account. In respect of transactions covered by foreign
 exchange contracts, the diference between the contract rate and the
 spot rate on the date of the transaction is charged to the profit and
 Loss Account over the period of the contract.
 
 (xiv) ACCOUNTING FOR VOLUNTARY RETIREMENT SCHEME
 
 (a) The cost of Voluntary Retirement Scheme / Retrenchment
 Compensation, including ex-gratia and additional gratuity liability
 arising there from, are charged to the profit and Loss Account in the
 month of separation of employees.
 
 (b) The Present Value of future payments to employees opting for Early
 Separation Scheme (ESS) and the additional gratuity liability arising
 there from are charged to the profit and Loss Account in the month of
 separation of employees.
 
 (xv) OPERATING LEASE
 
 Operating lease expenses / income are recognised in the profit and Loss
 Account on Straight Line Basis, representative of the time pattern of
 the user''s benefit.
 
 (xvi) EMPLOYEE BENEFITS
 
 (a) Defned Contribution Plan
 
 Contribution to Superannuation Fund, a defned contribution scheme, is
 made at pre-determined rates to the Superannuation Fund Trust and is
 charged to the profit and Loss Account. There are no other obligations
 other than the contribution payable to the Superannuation Fund Trust.
 
 (b) Defned benefit Plans
 
 (i) The Company''s liabilities towards gratuity and post retirement
 medical benefit schemes are determined using the projected unit credit
 method which considers each period of service as giving rise to an
 additional unit of benefit entitlement and measures each unit separately
 to build up the fnal obligation. Actuarial gains and losses based on
 valuation done by the independent actuary carried out annually are
 recognised immediately in the profit and Loss Account as income or
 expense. Obligation is measured at the present value of the estimated
 future cash flows using a discounted rate that is determined by
 reference to market yields at the Balance Sheet date on Government
 bonds where the currency and terms of the Government bonds are
 consistent with the currency and estimated terms of the defned benefit
 obligation.
 
 (ii) The Company''s Contribution to recognised Provident Fund paid /
 payable during the year is recognised in the profit and Loss Account.
 The shortfall, if any, between the return guaranteed by the statute and
 actual earnings of the Fund is provided for by the Company and
 contributed to the Fund.
 
 (c) Compensated Absences
 
 Compensated absences which accrue to employees and which are expected
 to be availed in twelve months immediately following the year end are
 reported as expenses during the year in which the employees perform the
 services that the benefit covers and the liabilities are reported at the
 undiscounted amount of the benefit and where the availment or encashment
 is otherwise not expected to wholly occur in the next twelve months,
 the liability on account of the benefit is actuarially determined using
 the projected unit credit method.
 
 (xvii) SEGMENT REPORTING
 
 The accounting policies used in the preparation of the financial
 statements of the Company are also applied for Segment Reporting.
 Revenue and expenses have been identifiedto segments on the basis of
 their relationship to the operating activities of the segment. Revenue
 and expenses, which relate to the enterprise as a whole and are not
 allocable to segments on a reasonable basis, have been included under
 Unallocated income / expenses.