(i) Accounting Convention
 
 The Financial Statements are prepared to comply in all material aspects
 with all the applicable accounting principles in India, the applicable
 accounting standards notified under sub-section (3C) of Section 211 of
 the Companies Act, 1956 (the Act) and the other relevant provisions
 of the Act.
 
 (ii) Fixed Assets
 
 Fixed Assets are stated at cost (net of cenvat credit, wherever
 applicable) less accumulated depreciation and impairment loss, if any.
 The cost includes cost of acquisition, construction, erection,
 installation etc., preoperative expenses (including trial run) and
 borrowing costs incurred during pre-operational period. Cost of
 software includes license fees and implementation/ integration
 expenses.
 
 (iii) Incidental Expenditure Pending Capitalisation/Allocaton
 
 Incidental expenditure pending capitalisation/allocation represents
 expenses incurred during setting-up of manufacturing facility including
 preoperative expenses for trial runs and borrowing cost incurred prior
 to the date of commencement of commercial production. These expenses
 are net of sales during trial run and other income accrued prior to the
 commencement of commercial production.
 
 (iv) Borrowing Costs
 
 Borrowing costs directly attributable to the acquisition/ construction
 of fixed assets are apportioned to the cost of the fixed assets up to
 the date on which the asset is put to use/ commissioned.
 
 (v) Depreciaton
 
 (a) Depreciaton on fixed assets, other than leasehold improvements and
 computer software, is provided on straight-line method at the rates and
 in the manner prescribed under Schedule XIV to the Act. Depreciation on
 additons/ deletions to fixed assets is calculated pro-rata from/ up to
 the date of such additons/ deletons.
 
 (b) Leasehold improvements are amortised on straight-line basis over
 the primary period of lease.
 
 (c) Computer software is amortised on the straight-line method over a
 period of five years.
 
 (d) Assets individually costing Rs. 5,000 or less are fully depreciated
 in the year of purchase.
 
 (vi) Investments
 
 Long term investments are stated at cost less provision, if any, for
 diminution in value other than temporary.  Current investments are
 carried at the lower of cost and fair value.
 
 (vii) Inventories
 
 (a) Inventories are valued at lower of cost and net realisable value.
 
 (b) Cost of raw materials, stores and spares and traded goods is
 determined on first-in-first-out basis. Cost of work-in-process and
 finished goods comprises of raw material, direct labor, other direct
 costs and related overheads but exclude interest expense. Net
 realisable value is the estimate of the selling price in the ordinary
 course of the business, less the estimated costs of completion and
 estimated selling expenses.
 
 (viii) Accounting for Taxes on Income/ Minimum Alternate Tax Credit
 
 (a) Current Taxaton
 
 The current tax is determined as the amount of tax payable in respect
 of taxable income for the year as per The Income Tax Act, 1961, of
 India.
 
 (b) Deferred Taxaton
 
 - Deferred tax resultng from timing differences between book and tax
 profits is accounted for under the liability method, at the
 current/substantially enacted rate of tax to the extent that the timing
 differences are expected to crystallise.
 
 - Deferred tax assets arising in situations where there are brought
 forward losses and unabsorbed depreciaton as per the Income Tax Act,
 1961, of India to the extent deferred tax amount exceeds net deferred
 tax liabilites, are recognised only when there is a virtual certainty
 supported by convincing evidence that such assets will be realised.
 
 (c) Minimum Alternate Tax Credit
 
 Minimum Alternate Tax (MAT) paid in accordance with tax laws, which
 give rise to future economic benefits in the form of adjustment of
 future tax liability, is recognised as an asset only when, based on
 convincing evidence, it is probable that the future economic benefits
 associated with it will flow to the Company and the assets can be
 measured reliably.
 
 (ix) Employee Benefits
 
 (a) Defined Contribution Plans
 
 The Company contributes on a defined contribution basis to Employee''s
 Provident Fund, Employee''s State Insurance Fund and Employee''s Pension
 Scheme towards post employment benefits, all of which are administered
 by the respective Government authorities, and has no further obligation
 beyond making its contribution, which is expensed in the year to which
 it pertains.
 
 (b) Defined Benefit Plans
 
 The Company has a Defined Benefit Plan namely Gratuity for all its
 employees. The liability for the defined benefit plan of Gratuity is
 determined on the basis of an actuarial valuation, calculated using
 projected unit credit method, by an independent actuary at the year
 end.
 
 Gratuity Fund is recognised by the income tax authorities and is
 administered through trustees. The Employee''s Gratuity Trust takes
 group gratuity policies with insurance companies.
 
 Actuarial gains and losses which comprise experience adjustments and
 the effect of changes in actuarial assumptions are recognised in the
 Profit and Loss Account.
 
 (c) Employee Leave Entitlement
 
 The employees of the Company are entitled to leave as per the leave
 policy of the Company. The liability in respect of unutlised leave
 balances is provided based on an actuarial valuation carried out by an
 independent actuary as at the year end and charged to the Profit and
 Loss Account.
 
 (x) Foreign Currency Transactions, Derivative Instruments and Hedge
 Accounting
 
 (a) Foreign currency transactions are recorded at the exchange rates
 prevailing on the date of such transactions.  Monetary assets and
 liabilities as at the Balance Sheet date are translated at the rates of
 exchange prevailing at the date of the Balance Sheet. Gains and losses
 arising on account of diferences in foreign exchange rates on
 settlement/ translation of monetary assets and liabilities are
 recognised in the Profit and Loss Account except for monetary items
 that in substance forms part of Company''s net investment in a
 non-integral foreign operation are recognised in Foreign Exchange
 Translation Reserve. Non-monetary foreign currency items are carried at
 cost.
 
 (b) In respect of forward contracts, other than forward contracts in
 respect of firm commitments and highly probable forecast transactions,
 the premium or discount arising at the inception of forward exchange
 contract, is amortised as expense or income over the life of the
 contract. Exchange differences on such contracts are recognised in the
 Profit and Loss Account in the reporting period in which the exchange
 rates change. Any profit or loss arising on cancellation or renewal of
 such a forward exchange contract is recognised as income or as expense
 for the period.
 
 (c) In respect of forward contracts and currency options taken to hedge
 the risks associated with foreign currency fluctuations relating to
 firm commitments and highly probable forecast transactions, the Company
 has adopted Accounting Standard 30 ‘Financial Instruments: Recognition
 and Measurement. Accordingly, foreign currency fluctuations relating
 to firm commitments and highly probable forecast transactions are fair
 valued at each reporting date.
 
 Changes in the fair value of these hedging instruments that are
 designated and considered as efective hedges of highly probable
 forecasted transactions are recognised directly in shareholders'' funds
 under ‘Hedging Reserve Account'' to be recognised in the Profit and Loss
 Account when the underlying transaction occurs.  Changes in the fair
 value of the hedging instruments that do not qualify for hedge
 accounting are recognised in the Profit and Loss Account as they arise.
 
 (xi) Revenue Recognition
 
 (a) Sales revenue is recognised on transfer of significant risks and
 rewards of ownership of the goods to the buyer. Domestic sales are
 recognised on dispatch to customers. Export sales are recognised on the
 date of cargo receipts, bill of lading or other relevant documents, in
 accordance with the terms and conditions for sales. Realised exchange
 differences on export debtors are included in sales.
 
 (b) In case of sales made by the Company as Support Manufacturer,
 export benefits arising from Duty Entitlement Pass Book(DEPB) are
 recognised on export of such goods in accordance with the agreed terms
 and conditions with customers. In case of direct exports made by the
 Company export benefits arising from DEPB, Duty Drawback scheme and
 Focus Market Scheme are recognised on shipment of direct exports.
 
 (c) Dividends are accounted for when the right to receive dividend is
 established.
 
 (xii) Government Grants
 
 Government grants are accounted for when it is reasonably certain that
 ultimate collection will be made. Capital grants relating to specific
 assets are reduced from the gross value of the Fixed Assets. Revenue
 grants, in the nature of interest subsidy under the Technology
 Upgradation Fund Scheme (TUFS) are adjusted against ‘Interest on Fixed
 Loans''.
 
 (xiii) 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 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 recognised 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 refected
 at the recoverable amount.
 
 (xiv) 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 a possible
 obligation or a present obligation but the likelihood of outflow of
 resources is remote, no provision or disclosure is made as specified in
 Accounting Standard 29 –  Provisions, Contingent Liabilities and
 Contingent Assets, notified under Section 211(3C) of the Act.
 
 (xv) Employees Stock Option Schemes
 
 Stock options granted to employees under Employee Stock Option Schemes
 are accounted as per the accounting treatment prescribed in the
 Guidance Note on Accounting for Employee Share-based Payments issued by
 the Institute of Chartered Accountants of India.
 
 (xvi) Accounting Estimates
 
 The preparation of financial statements requires estimates and
 assumptions to be made that affect the reported amounts of assets and
 liabilities on the date of financial statements and the reported
 amounts of revenue and expenses during the reporting period. Difference
 between the actual results and the estimates are recognised in the
 period in which the results are known/ materialised.