Note : 1 SIGNIFICANT ACCOUNTING POLICIES :

A. Basis of Accounting

The accounts of the company are brpared & maintained consistently on accrual basis and under the historic cost convention and in accordance with the generally accepted accounting principles in India and complies with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and relevant provisions of the Companies Act, 2013 except otherwise stated. All assets and liabilities have been classified as current or non-current as per the Company's normal operating cycle and other criteria setout in the Schedule III to the Companies Act,2013.

B. Fixed Assets :

Fixed Assets are stated at cost (cost includes acquisition cost, freight, installation cost, finance cost, duties and taxes and other  incidental expenses incurred during the  construction/ installation). Borrowing cost directly attributable to acquisition of those fixed assets which necessarily takes substantial period of time to get ready for their intended use are capitalized.

B 1 Change of Accounting Policy:

As reported during the financial year 2012-13, the Company converted all its agricultural lands into Stock-in-trade and sold a part of the same to utilize sale proceeds for meeting repayment obligations to Financial institutions/Banks. During the Financial Year 2014-15 the Company incurred site development charges and the same is treated as a part of cost to land. The income derived on sale of part of stock of land during the financial year 2014-15 is considered as business income since the land is held for sale as a business objective and the balance land is shown as Stock in trade as 31stMarch, 2015 This is a change in of Accounting Policy and hence the disclosure.

B 2 Extraordinary Item:

The company has obtained a surplus on the sale of part of its land which was disclosed in the Statement of Profit and Loss / Income Statement as Rs. 22,50,471 as an extraordinary

item.

C Inventories :

Inventories have been valued at lower of cost or net realizable value whichever is lower.

The cost of purchases of inputs includes all charges in bringing the goods in point of sale, excise duty, custom duty less CENVAT availed. Work in progress and finished goods include appropriate proportion of overheads. The company has during the year, accounted for a portion of the land as a current asset and it implies that it is held for sale. The same was valued at cost or net realizable value whichever is lower.

D. Cash and Cash equivalents:

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

E. Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of  the Company are segregated based on the  available information.

F Debrciation :

Debrciation on fixed assets is provided based on the straight line method over useful lives of the assets estimated by the management as brscribed in Schedule II to the Companies Act, 2013. The value of assets  whose estimated life is over at the commencement of the year are written off to  opening retained earnings.

G Revenue Recognition :

Revenue is recognized from the sale of goods, net of returns and trade discounts, as and when the goods are delivered and title to the ownership is transferred.

a. Other Income:

Interest Income, Rental Incomes and Profiton sale of Machinery are accounted on accrual basis.

H. Investments

Long-term investments are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value. Cost of investments includes acquisition charges such as brokerage, fees and duties.

L Employee Benefits:

Employee benefits include provident fund, ESI, gratuity, medical benefits.

J. Gratuity:

The company has Defined Benefit Plan for post employment benefit in form of Gratuity for eligible employees, which is administered through a Group Gratuity Policy with Life Insurance Corporation of India (L.I.C). The liability for the above Defined Benefit Plan is provided on the basis of  an actuarial valuation as carried out by L.I.C

K. Leases

Lease arrangements where the risks and rewards incidental to ownership of an asset substantially vest with the lessor are recognized as operating leases. Lease rentals under operating leases are recognized in the Statement of Profit and Loss on a straight-line basis.

L. Earnings per share:

Basic earnings per share is computed by dividing the profit/ (loss) after tax (including the post-tax effect of extra ordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post-tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. Dilutive potential equity shares are determined independently for each period brsented.

M. Taxes on Income

Current tax is the amount of 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 differences, being the differences 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 ismeasured using the tax rates and the tax laws enacted or substantially enacted as at the reporting date. Deferred tax assets in respect of un absorbed debrciation and carry forward of losses are recognised only if there is virtual certainty that there will be sufficient future taxable income available to realize such assets. Deferred tax assets are recognised for timing differences of other items only to the extent that reasonable certainty exists that sufficient future taxable income willbe available against which these can be realized. Deferred tax assets and liabilities are offset if such items relate to taxes on income levied by the same governing tax laws and the Company has a legally enforceable right for suchset off. Deferred tax assets are reviewed at each Balance Sheet date for their readability.

N. Impairment of Assets

The carrying values of assets / cash generating units at each Balance Sheet date are reviewed for impairment. If any indication of 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.

There coverable 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 brsent value based on an appropriate discount factor.

O. Provisions and Contingencies

A provision is recognised when the Company has a brsent obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions are not discounted to their brsent value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

P. Service Tax Input Credit

Service tax input credit is accounted forin the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing/utilizing the credits.

Q. Segment Information:

The Company operates in a single line of manufacturing which is subject to similar risks and returns. Also the business of the company is with in a particular environment which is subject to similar risks and returns.

Hence, there is no a business or geographical risks to be reported by the company.

Note 3 : Sundry Debtors and Sundry Creditor's balances are subject to reconciliation and confirmation.

Note 4 : Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

As per our Report of Even date attached

for SPC & Associates  

Chartered Accountants

 F.R.No. 005685S

P. VEERANARAYANA  

Managing Director

P. MADHUPRATHAP  

Technical Director & CFO

CA SESHAA RSR PRASAD K

 (Partner)

M. No.028591

Place: Tirupati

Date : 27th May 2015