a) Basis of Accounting:
 
 The financial statements have been prepared under historical cost
 convention, on accrual basis, in accordance with the generally accepted
 accounting principles in India and in accordance with Accounting
 Standards as notified by Companies (Accounting Standards) Rules 2006.
 
 b) Use of Accounting Estimates
 
 The preparation of financial statements in conformity with generally
 accepted accounting principles requires management to make estimates
 and assumptions that affect the reported amount of assets and
 liabilities and disclosure of contingent liabilities on the date of
 financial statements and the result of operations during the reporting
 period. Although these estimates are based on managements knowledge of
 current events and actions, actual results could differ from those
 estimates.
 
 c) Fixed assets:
 
 Fixed Assets are carried at cost of acquisition or construction less
 accumulated depreciation. The actual cost capitalized comprises of cost
 of acquisition of the asset, clearing charges in case of imported
 assets, duties, taxes and other incidental expenditure incurred for
 acquiring the assets. Borrowing costs directly attributable to
 acquisition or construction of those fixed assets which necessarily
 take a substantial period of time to get ready for their intended use
 are capitalized.
 
 d) Depreciation:
 
 Depreciation on fixed assets is provided on the straight-line method
 and at the rates and in the manner specified in Schedule XIV to the
 Companies Act, 1956, except in respect of improvements to leasehold
 premises, where depreciation is charged over the lease period.
 
 e) Product development expenditure:
 
 Direct material and overhead costs in relation to product development
 activities are treated as deferred revenue expenditure and amortized
 over five years from the date revenue is generated from the respective
 products. All other revenue expenditure is expensed as incurred and
 capital expenditure incurred on product development is capitalized as
 fixed assets and depreciated in accordance with depreciation policy of
 the Company.
 
 f) Foreign currency translations:
 
 Transactions denominated in foreign currencies are recorded at the
 exchange rate prevailing at the time of transaction. Monetary assets
 and liabilities related to foreign currency transactions remaining
 unsettled at the end of the year are translated at year end rates. The
 difference in translation of monetary assets and liabilities and
 realized gains and losses to foreign exchange transactions are
 recognized in Profit and Loss account.
 
 g) Investments:
 
 Long term investments are stated at cost of acquisition less provision
 for permanent diminution in value of such investments.
 
 h) Inventories:
 
 Inventories are valued at the lower of cost and net realisable value.
 Cost of inventories comprises cost of purchase, cost of conversion and
 other costs incurred in bringing the inventories to their present
 location and condition. The method of determining cost of various
 categories of inventories is as below:
 
 i) Raw materials, Packing materials, Stores and spares - First - in -
 First Out method.
 
 ii) Finished goods and Work-in-process - Weighted average method, which
 comprises direct material costs and appropriate overheads.
 
 i) Retirement benefits:
 
 Liability for employee benefits, both short and long term, for present
 and past services which are due as per terms of employment are recorded
 in accordance with Accounting Standard (AS) 15  Employee Benefits as
 notified by the Companies (Accounting Standards) Rules, 2006.
 
 i) Gratuity
 
 Liability on account of Gratuity is determined and charged to Profit
 and Loss account on the basis of valuation by an independent Actuary.
 The liability is unfunded.
 
 ii) Provident Fund
 
 Contribution to Provident Fund (a defined contribution plan) is
 recognized and expensed on accrual basis.
 
 iii) Compensated Absences
 
 Liability in respect of compensated absence is determined and charged
 to Profit and Loss account on the basis of valuation by an independent
 actuary.
 
 j) Revenue recognition:
 
 Sale of goods is recognized at the point of dispatch of finished goods
 to customers. Sales include amount recovered towards excise duty but
 excludes sales tax and is net of sales returns.
 
 Service income is recognized as per the terms of the contract with
 customers when the related services are performed.
 
 Income from interest on deposits is recognised on time proportionate
 basis.
 
 k) Taxes on Income :
 
 Current tax is determined as the amount of tax payable in respect of
 taxable income for the year. Deferred tax is recognized, 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.
 
 l) Leases :
 
 The Companys significant leasing arrangements are in respect of
 operating leases for office premises. The leasing arrangements which
 are not cancelable range between 11 months to 5 years are generally and
 usually renewable by mutual consent on agreed terms. The aggregate
 lease rents payable are charged as rent in the Profit and Loss account.
 
 m) Miscellaneous expenditure:
 
 Written off over a period of five years or the period over which the
 benefit of the expenditure is expected to be derived.
 
 o. Subsequent to Daiichi Sankyo Company Limited (Daiichi) acquiring
 63.92% stake in Ranbaxy Laboratories Limited (Ranbaxy) in October 2008,
 Daiichi announced an open offer to acquire 20% shares of Zenotech
 Laboratories Limited (the Company) at Rs. 113.62 per share. Aggrieved
 by the pricing of the share, one of the shareholders filed a petition
 in the Honble High Court of Madras. The Company has been named as
 Respondent in the said case. An interim injunction in connection with
 the offer was given by the Honble High Court of Madras and
 subsequently it was quashed by the Honble Supreme Court based on a
 petition filed by Daiichi against the said injunction. Meanwhile some
 of the shareholders (excluding Ranbaxy) including Promoter and Managing
 Director of the Company filed a petition with Securities Appellate
 Tribunal (SAT) with respect to the pricing of the share of the Company.
 SAT directed Daiichi to price the open offer at Rs. 160 per share.
 Daiichi has filed an appeal against the SAT order in the Supreme Court.
 The Supreme Court vide its order dated July 8, 2010 has ruled in favour
 of Daiichi and allowed the open offer to be made at the price of Rs.
 113.62 per share.