2.12. Provisions. Contingent Liability and Contingent Assets

Disputed liabilities and claims against the company including claims raised by
fiscal authorities (eg Vat. Income Tax, Service Tax etc.,) pending in
appeal/court for which no reliable estimate can be made and or involves
uncertainty of the outcome of the amount of the obligation or which are remotely
poised for crystallization are not provided for in accounts but disclosed in notes to

^accounts/^R^\

However, present obligation as a result of past event with possibility of outflow of
resources, when reliable estimation can be made of the amount of obligation, is
recognized in accounts in terms of discounted value, if the time value of money is
material using a current pre-tax rate that reflects the risk specific to the liability.

No contingent asset is recognized but disclosed by way of notes to accounts.

2.13. Operating Segments

The Chief Operational Decision Maker monitors the operating results of its
business segments separately for the purpose of making decisions about
resource allocation and performance assessment. Segment performance is
evaluated based on profit and loss and is measured consistently with profit and
loss in the financial statements.

The Operating segments have been identified on the basis of the nature of
products/services.

a) Segment revenue includes sales and other income directly identifiable with
the segment including inter-segment revenue.

b) Expenses that are directly identifiable with the segments are considered for
determining the segment results. Expenses which relate to the Group as a
whole and not allocable to segments are included under unallocable
expenditure

c) Income which relates to the company as a whole and not allocable to
segments is included in unallocable income.

d) Segment result includes margins on inter-segment and sales which are
reduced in arriving at the profit before tax of the company.

e) Segment assets and liabilities include those directly identifiable with the
respective segments Unallocable assets and liabilities represent the assets
and liabilities that relate to the company as a whole and not allocable to any
segment.

2.14. Earnings per Share

Basic Earnings per share is calculated by dividing the total comprehensive
income for the period attributable to equity shareholders by the number of equity
shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit for the
period attributed to equity shareholders and the number of shares outstanding
during the period is adjusted for the effects of all dilutive potential equity

shares.

2.15. Borrowing Cost

Borrowing cost that are directly attributable to the acquisition, construction, or
production of a qualifying asset are capitalized as a part of the cost of such asset
till such time the asset is ready for its intended use or sale Borrowing cost
consists of interest and other costs that an entity incurs in connection with the
borrowing of funds. Borrowing costs also includes exchange differences to the
extent regarded as an adjustment to the borrowing costs. A qualifying asset is an
asset that necessarily requires a substantial period of time to get ready for its
intended use or sale. All other borrowing cost are recognized as expense in the
period in which they are incurred.

2.16. Cash and Cash Equivalents

For the purpose of presentation in the statement of cash flows, cash and cash
equivalents includes cash on hand, deposits held at call with financial institutions,
other short-term, highly liquid investments with original maturities of three months
or less that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.