A code that implements Einstein's equations in the characteristic formulati
on in 3D has been developed and thoroughly tested for the vacuum case. Here
, we describe how to incorporate matter, in the form of a perfect fluid, in
to the code. The extended code has been written and validated in a number o
f cases where shocks do not form. It is stable and capable of contributing
towards an understanding of a number of problems in black hole astrophysics
. [S0556-2821(99)00614-1].