Accounting Policies of Hiran Orgochem Ltd. Company

Mar 31, 2015

(a) Accounting Convention

The financial statements are prepared on under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed. To meet with various operational financial obligations many measures are taken and accordingly these statements are continued to be prepared on the assumption of going concern, which contemplates realisation of assets and settlement of liabilities in the normal course of the business.

All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria set out in the Revised Schedule III to the Companies Act, 2013. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has determined its operating cycle as twelve months for the purpose of current - non current classification of assets and liabilities.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between actual results and estimates are recognized in the year in which the results are known/materialize.

(c) Fixed Assets And Depreciation

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. Depreciation for the year has been provided on the straight-line method as per Companies Act, 2013 at rates specified in Schedule II of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata.basis. During the year all the factory assets of the company has been sold by asset reconstruction company appointed by bank. However, as per management the principle of going concern is not affected.

(d) Revenue Recognition

(i) Sales are stated net of trade discounts, sales return and sales tax.

(ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

(iii) Custom Duty benefits in the form of advance license entitlements are recognised on export of goods.

(iv) Income from investments is accounted on receipt basis.

(v) Project revenues are accounted as per AS- 7.

(e) Inventories

(i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

(ii) Material in Process/ Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

(iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

(f) Investments

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

(g) Employee Benefits

(i) Defined Contribution Plan

Company's contributions paid/payable during the year to Provident Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The company's liabilities towards- gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the actual basis during the year as at the balance sheet date.

(h) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Accou nt.

(ii) Amount of Foreign currency transactions remaining pending at year end are recorded at the exchange rate prevailing at that time.

(iii) Foreign currency transactions relating loans taken are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Finance Costs.

(iv) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance I ife of the asset.

(v) Foreign currency assets and liabilities at the end of the year, is converted in Indian currency at the exchange rate prevailing at that time.

(i) Borrowing Costs

(i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

(ii) Borrowing cost on working capital is charged to Profit & Loss Account.

(j) Taxes On Income

(i) Tax expense comprises of Current and

Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities, in accordance with the IncomeTax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax duringthe specified period.

(k) Provisions, Contingent Liabilities And Contingent

Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabi I ities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

(I) 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 asset or the recoverable amount of 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 recognized 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 ' is reassessed and the asset is reflected at the recoverable amount.

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Mar 31, 2014

(a) Accounting Convention

During the current year the company has changed its year ending to 31st March from 30th June. In this report year ended refers to the period of 9 months from 1st July, 2013 to 31st March, 2014. Therefore previous year''s figures not comparable.

The financial statements are prepared on under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed. To meet with various operational financial obligations many measures are taken and accordingly these statements are continued to be prepared on the assumption of going concern, which contemplates realisation of assets and settlement of liabilities in the normal course of the business.

All assets and liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the Revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has determined its operating cycle as twelve months for the purpose of current - non current classification of assets and liabilities.

b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between actual results and estimates are recognized in the year in which the results are known /materialize.

(c) Fixed Assets And Depreciation

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. Depreciation for the year has been provided on the straight-line method U/s 205 (2)(b) of the Companies Act, 1956 at rates specified in Schedule XIV of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata basis. No write off has been made in respect of GIDC leasehold land at Panoli.

(d) Revenue Recognition

(i) Sales are stated net of trade discounts, sales return and sales tax.

(ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

(iii) Custom Duty benefits in the form of advance license entitlements are recognised on export of goods.

(iv) Income from investments is accounted on receipt basis.

(v) Project revenues are accounted as per AS- 7.

(e) Inventories

(i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

(ii) Material in Process/ Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

(iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

(f) Investments

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

(g) Employee Benefits

(i) Defined Contribution Plan

Company''s contributions paid/payable during the year to Provident Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The company''s liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the actual basis during the year as at the balance sheet date.

(h) Foreign Currency Transactions

(i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

(ii) Amount of Foreign currency transactions remaining pending at year end are recorded at the exchange rate prevailing at that time.

(iii) Foreign currency transactions relating loans taken are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Finance Costs.

(iv) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance life of the asset.

(v) Foreign currency assets and liabilities at the end of the year, is converted in Indian currency at the exchange rate prevailing at that time.

(i) Borrowing Costs

(i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

(ii) Borrowing cost on working capital is charged to Profit & Loss Account.

(j) Taxes On Income

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

(k) Provisions, Contingent Liabilities And Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

(l) 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 asset or the recoverable amount of 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 recognized 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 is reassessed and the asset is reflected at the recoverable amount.

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Jun 30, 2013

(a) Accounting Convention

The financial statements are prepared on under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed. To meet with various operational financial obligations many measures are taken and accordingly these statements are continued to be prepared on the assumption of going concern, which contemplates realisation of assets and settlement of liabilities in the normal course of the business.

''All assets arid liabilities have been classified as current or non-current as per the Company''s normal operating cycle and other criteria set out in the Revised Schedule VI to the Companies Act, 1956. Based on the nature of products and the time between the acquisition of assets for processing and their realisation in cash and cash equivalents, the Company has determined its operating cycle as twelve months for the purpose of current - non current classification of assets and liabilities.

(b) Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the. reporting year. Differences between actual results and estimates are recognized in the year in which the results are known/materialize.

(c) Fixed Assets And Depreciation

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. , Depreciation for the year has been provided on the straight-line method U/s 205 (2)(b) of the Companies Act, 1956 at rates specified in Schedule XIV of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata basis. No write off has been made in respect of CIDC leasehold land at Panoli.

(d) Revenue Recognition

(i) Sales are stated net of trade discounts, sales return and sales tax.

(ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

(iii) Custom Duty benefits in the form of advance license entitlements are recognised on export ofgoods.

(iv) Income from investments is accounted on receipt basis.

(v) Project revenues are accounted as per AS- 7.

(e) Inventories

(i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

(ii) Material in Process/Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

(iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

(f) Investments

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

(g) Employee Benefits

(i) Defined Contribution Plan

Company''s contributions paid/payable during the year to Provident Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The company''s liabilities towards gratuity and leave encashment, a defined laenefit obligation, is accrued and provided .for. on the basis of actuarial valuation, using the projected unit ,. credit method as at the Balance Sheet date.

(h) Foreign Currency Transactions

(i) Foreign currency transactions, are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the

Profit & Loss Account.

(ii) Amount of Foreign currency transactions remaining pending at year end are recorded at the exchange rate prevailing at that time.

(iii) Foreign currency transactions relating loans taken are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Finance Costs.

(iv) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance life of the asset

(v) Foreigncurrencyassetsandliabilitiesattheend of,the year, is converted in Indian currency at the exchange rate prevailing at mat time.

(i) Borrowing Costs

(i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

(ii) Borrowing cost on working capital is charged to , Profit & Loss Account

(j) taxes On Income

(i) Tax expense comprises of Current and fented Tax. Current Income Tax is at the

v) authorities in accordance whfvthe me Tax taxable and accounting income/expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

(k) Provisions, Contingent Liabilities And Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

(0 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 asset or the recoverable amount of 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 recognized 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 is reassessed and the asset is reflected at the recoverable amount.

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Jun 30, 2011

A) ACCOUNTING CONVENTION

The financial statements are prepared on the basis of going concern, under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed.

b) USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between actual results and estimates are recognized in the year in which the results are known /materialize.

c) FIXED ASSETS AND DEPRECIATION

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. Depreciation for the year has been provided on the straight-line method U/S.205 (2)(b) of the Companies Act, 1956 at rates specified in Schedule XIV of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata basis. No write off has been made in respect of GIDC leasehold land at Panoli.

d) REVENUE RECOGNITION

(i) Sales are stated net of trade discounts, sales return and sales tax.

(ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

(iii) Custom Duty benefits in the form of advance license entitlements are recognised on export of goods.

(iv) Income from investments is accounted on receipt basis.

(v) Project revenues are accounted as per AS- 7.

e) INVENTORIES

(i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

(ii) Material in Process/ Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

(iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

f) INVESTMENTS

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

g) EMPLOYEE BENEFITS

(i) Defined Contribution Plan

Companys contributions paid/payable during the year to Provident Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The companys liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

h) FOREIGN CURRENCY TRANSACTIONS

i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

ii) Amount of Foreign currency transactions remaining pending at year end are recorded at the exchange rate prevailing at that time.

iii) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance life of the asset.

iv) Foreign currency balance at the end of the year, in EEFC bank account is converted in Indian currency at the exchange rate prevailing at that time.

i) BORROWING COSTS

i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

ii) Borrowing cost on working capital is charged to Profit & Loss Account.

j) MISCELLANEOUS EXPENDITURE

Preliminary and Share issue expenses are amortised over a period of five years.

k) TAXES ON INCOME

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/ expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that company will pay normal Income Tax during the specified period.

l) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

m) 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 asset or the recoverable amount of 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 recognized 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 is reassessed and the asset is reflected at the recoverable amount.

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Mar 31, 2011

A) ACCOUNTING CONVENTION

The financial statements are prepared on the basis of going concern, under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses, mercantile system of accounting is followed.

b) USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between actual results and estimates are recognized in the year in which the results are known /materialize.

c) FIXED ASSETS AND DEPRECIATION

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. Depreciation for the year has been provided on the straight-line method U/S.205 (2)(b) of the Companies Act, 1956 at rates specified in Schedule XIV of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata basis. No write off has been made in respect of GIDC leasehold land at Panoli.

d) REVENUE RECOGNITION

(i) Sales are stated net of trade discounts, sales return and sales tax.

(ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

(iii) Custom Duty benefits in the form of advance license entitlements are recognised on export of goods.

(iv) Income from investments is accounted on receipt basis.

(v) Project revenues are accounted as per AS- 7.

e) INVENTORIES

(i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

(ii) Material in Process/ Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

(iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

f) INVESTMENTS

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

g) EMPLOYEE BENEFITS

(i) Defined Contribution Plan

Company's contributions paid/payable during the year to Provident Fund are recognised in the Profit & Loss Account.

(ii) Defined benefit plan

The company's liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

h) FOREIGN CURRENCY TRANSACTIONS

i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

ii) Amount of Foreign currency transactions remaining pending at year end are recorded at the exchange rate prevailing at that time.

iii) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance life of the asset.

iv) Foreign currency balance at the end of the year, in EEFC bank account is converted in Indian currency at the exchange rate prevailing at that time.

i) BORROWING COSTS

i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

ii) Borrowing cost on working capital is charged to Profit & Loss Account.

j) MISCELLANEOUS EXPENDITURE

Preliminary and Share issue expenses are amortised over a period of five years.

k) TAXES ON INCOME

(i) Tax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

(ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/ expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

(iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that company will pay normal Income Tax during the specified period.

l) PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

m) 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 asset or the recoverable amount of 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 recognized 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 is reassessed and the asset is reflected at the recoverable amount.

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Mar 31, 2010

A) ACCOUNTING CONVENTION

The financial statements are prepared on the basis of going concern, under historical cost convention on an accrual basis and in accordance with the requirements of the Companies Act, 1956 and comply with the Accounting Standard issued by the Institute of Chartered Accountants of India to the extent applicable. For recognition of Income and Expenses mercantile system of accounting is followed.

b) USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities on the date of the financial statements and the reported amounts of revenue and expenses during the reporting year. Differences between actual results and estimates are recognized in the year in which the results are known/materialize.

c) FIXED ASSETS AND DEPRECIATION

All fixed assets are stated at cost, less cenvat availed, but including relevant direct expenses. Depreciation for the year has been provided on the straight-line method U/S.205 (2)(b) of the Companies Act, 1956 at rates specified in Schedule XIV of the said Act. Depreciation on the additions/deletions to assets during the year is provided on pro-rata basis. No writeoff has been made in respect of GI DC leasehold land at Panoli.

d) REVENUE RECOGNITION

i) Sales are stated net of trade discounts, sales return and sales tax.

ii) The value of Cenvat benefits eligible is being reduced from the value of purchases of materials. Consumption of materials is arrived at accordingly.

iii) Custom Duty benefits in the form of advance license entitlements are recognised on export of goods.

iv) Income from investments is accounted on receipt basis.

v) Project revenues are accounted as per AS- 7.

e) INVENTORIES

i) Raw Materials, Stores and spares and packaging materials are valued at cost on FIFO/Weighted Average basis.

ii) Material in Process/ Work in Progress is valued at estimated cost. Work in Progress includes cost of land, development rights, construction costs and allocated interest and expenses incidental to the projects undertaken by the company.

iii) Finished goods are valued at lower of estimated cost or net realisable value. Costs of finished goods include excise duty wherever applicable.

f) INVESTMENTS

Long-term investments are stated at cost less provisions, if any, for permanent diminution in value of such investments.

g) EMPLOYEE BENEFITS

i) Defined Contribution Plan

Companys contribution paid/payable during the year to Provident fund are recognised in the Profit & Loss Account.

ii) Defined Benefit Plan

The companys liabilities towards gratuity and leave encashment, a defined benefit obligation, is accrued and provided for on the basis of actuarial valuation, using the projected unit credit method as at the Balance Sheet date.

h) FOREIGN CURRENCY TRANSACTIONS

i) Foreign currency transactions are recorded at the exchange rate prevailing at the time of transactions & exchange difference, if any, on settlement of transaction is recognised in the Profit & Loss Account.

ii) Amount of Foreign currency transactions remaining pending at year-end are recorded at the exchange rate prevailing at that time.

iii) The difference in translation of long-term monetary assets and liabilities and realised gains and losses on foreign currency transactions relating to acquisition of depreciable capital assets are added to or deducted from the cost of the asset and depreciated over the balance life of the asset.

iv) Foreign currency balance at the end of the year, in EEFC bank account is converted in Indian currency at the exchange rate prevai I i ng at that time.

i) BORROWING COSTS

i) Borrowing cost attributable to acquisition and/or construction of qualifying assets is capitalised as cost of such assets up to the date when such asset is ready for its intended use.

ii) Borrowing cost on working capital is charged to Profit & Loss Account.

j) MISCELLANEOUS EXPENDITURE

PreliminaryandShareissueexpensesareamortised over a period of five years.

k) TAXES ON INCOME

i) Tax expense comprises of Current, Deferred and Fringe Benefit Tax. Current Income Tax and. Fringe Benefit Tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961.

ii) Deferred tax is recognised, subject to consideration of prudence on timing difference, being the difference between the taxable and accounting income/ expenditure that originate in one year and are capable of reversal in one or more subsequent year(s). Deferred tax assets are not recognised unless there is virtual certainty that sufficient future taxable income will be available, against which such deferred tax asset will realise.

iii) Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the company will pay normal income tax during the specified period. In the year in which the MAT credit becomes eligible to be recognised as an asset in accordance with the recommendations contained in Guidance Note issued by the ICAI, the said asset is created by way of a credit to the Profit and Loss account and shown as MAT Credit Entitlement. The company reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

l PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statement.

m) 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 ofassetorthe recoverable amount of 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 recognized 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 is reassessed and the asset is reflected at the recoverable amount.