Mar 31, 2018
The Members,
The Directors take pleasure in presenting the Thirty Sixth Annual Report of your Company alongwith the Audited Statement of Accounts of the Company for the financial year ended 31st March, 2018.
1. RESULTS OF OUR OPERATIONS
(Figures in Millions)
Particulars |
Year ending 31.03.2018 (Rs.) |
Year ending 31.03.2017 (Rs.) |
Profit/(Loss) before interest, depreciation & tax |
113.16 |
157.53 |
Less: Interest |
68.49 |
63.41 |
Profit/(Loss) after interest, before depreciation & tax |
44.67 |
94.12 |
Less: Depreciation |
27.15 |
70.48 |
Profit/(Loss) before tax |
17.52 |
23.64 |
Less: Provision for taxation |
7.25 |
9.43 |
Deferred Tax Liability /(Asset) |
(4.66) |
1.79 |
Profit/(Loss) available for appropriation |
14.93 |
12.43 |
Less: Interim / Final Dividend |
- |
- |
Tax on Interim / Final Dividend |
- |
- |
Profit/(Loss) for the year |
14.93 |
12.43 |
Other comprehensive income |
-- |
(0.69) |
Add: Balance brought forward |
193.52 |
181.79 |
Less: Transfer to general reserve |
- |
- |
Profit/(Loss) Carried forward to Balance Sheet |
208.45 |
193.52 |
Companyâs Performance
During the year the total revenues of the Company were placed at Rs. 259.75 Millions compared to Rs. 714.12 Millions last year.
The Company''s performance and outlook has been discussed in detail in the Management Discussion and Analysis.
The holding company, and WWIL had filed applications to review the said Order with the High Court and an interim stay was granted on July 30, 2014 which required deposit by Mukta Arts Limited of Rs 10,00,38,000 by January 2015 against payment of arrears of rent for the years 2000-01 to 2013-14 and payment of Rs 45,00,000 per annum from financial year 2014-15 till the settlement of the case to MFSCDCL. As per the terms of the said Order, till 31 March 2018 Rs 11,35,38,000/- has been paid by the Holding Company and Rs 45,00,000/- has been paid by WWIL. The State Govt. of Maharashtra and MFSCDCL challenged the order of the High Court in the Supreme Court which was dismissed by the Supreme Court on September 22, 2014. The amount so paid / being paid by the holding company have been accounted under Non - Current Other Financial Assets in the Financial Statements to be adjusted on the settlement of the case. Management of WWIL informs that these will be accounted as an expense, if required, on the settlement of the case.
Dividend
Due to inadequate profits, the Directors regret their inability to recommend dividend for the financial year ended 31st March 2018 and no amount is proposed to be transferred to the reserves.
Particulars of loans, guarantees or investments by company
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to Financial Statements.
Deposits
The Company has not accepted any fixed deposits from the public, within the meaning of section 73 of the Companies Act, 2013 read with the Companies (Acceptance of deposits) Rules, 2014. Therefore, as on 31.03.2018 there were no deposits which were unpaid or unclaimed and due for repayment.
Particulars of Contracts or arrangements made with related party (ies)
All transactions entered with Related Parties during the year under review were:
- on armâs length basis and
- in the ordinary course of business and
- there were no material transactions with any related party
as per the provisions of sections 188 of the Companies Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014 and therefore, disclosure in Form AOC-2 is not required.
The Company has developed a Related Party Transactions framework through Standards Operating Procedures for the purpose of identification and monitoring of such transactions.
All Related Party Transactions are placed before the Audit Committee as also before the Board for approval. The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company. The web link of the same has been provided in the Corporate Governance Report. None of the Directors vis-a-vis the Company had any pecuniary relationship or transactions.
Material changes and commitment, if any, affecting the financial position of the company occurred between the end of the financial year to which this financial statements relate and the date of this report.
Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companyâs financial position have occurred between the end of the financial year of the Company and date of this report.
Share Capital
During the year under review, the company has not issued any Equity shares or any other securities.
2. BUSINESS OVERVIEW
Your Company has for the past 3 years, been focusing increasingly on the Cinema business. Over the years, the Company has built up a dedicated clientele with its offering of affordable luxury where the patron gets a world class experience at par with any of Indiaâs other top multiplexes, but at a distinctly more affordable value. The Company has expanded internationally in Bahrain to cater to cinema fans of the Kingdom of Bahrain with launch of âMukta A2 Cinemasâ first 6 screen luxury cinema in Juffair Mall. During the previous year, the Company has transferred its Cinema exhibition division to a separate legal entity Mukta A2 Cinemas Limited (Wholly- owned subsidiary) of Mukta Arts Limited.
Subsidiary and Joint Venture Companies
As on 31.03.2018 the Company has six subsidiary Companies namely, Whistling Woods International Limited, Connect.1 Limited, Mukta Tele Media Limited, Mukta Creative Ventures Limited (formerly known as Coruscant Tec Private Limited), Mukta A2 Multiplex SPC. and Mukta A2 Cinemas Limited. The Company also has one Joint Venture Company namely, Mukta V N Films Limited. Whistling Woods International Limited is a material subsidiary of the company within the meaning of Regulation 16(1)(c) of SEBI (Listing Disclosure and Obligation Requirements) Regulation, 2015.
Out of the subsidiaries of the Company, the most notable has been the Whistling Woods International Limited (âWWILâ) that has regularly been rated as one of the Ten Best Film Schools in the World by âThe Hollywood Reporterâ. In a first-of-its kind academia-industry partnership, Asiaâs premier Film, Communication and Creative Arts Institute, Whistling Woods International, has come together with Reliance Jio for a Development Lab dedicated for the Virtual Reality & Augmented Reality Industry. The lab, named âWhistling Woods Jio VR Labâ, has been set up at the Whistling Woods International Campus in Filmcity, Mumbai. The Lab has commenced its operations in mid-May 2018.
Mukta A2 Cinemas Limited (MA2) is a wholly-owned subsidiary company incorporated exclusively to handle the exhibition business. MA2 in joint venture with Asian Cinemas has launched 8 single screens at Gangavathi, Tandur, Nizamabad, Sadashivpeth, Kothagude, Medak, Khammam and Zaheerabad. MA2 this month has also taken over operations for launch of 2 screens at Sun City Multiplex, Vile Parle (East), Mumbai. It has started renovation of one of its screens and expects to complete it before the theatrical release of âRace-3â in June 2018. Thereafter the other screen will be operational to mark a signature multiplex here. With this, Mukta A2 Cinemas marks the completion of 48 screens globally. Mukta A2 Cinemas is now successfully operating in 14 cities making a PAN India presence to cater to the myriad needs of the movie buffs across the country.
Mukta A2 Multiplex SPC. is also a wholly-owned subsidiary company incorporated in the Kingdom of Bahrain for running of a 6 screen multiplex in the Mall situated at Juffair Mall. The theatre features the latest releases from Hollywood, Bollywood as well as Arabic releases. Itâs equipped with state-of-the-art technology, including Dolby Atmos and Quantum Logic 3D surround sound systems, Light Tripler polarisation 3D technology and modern projection system. The cinema also offers dynamic seating options such as VIP recliners, sofas and rocker seats, in addition to the variety of gourmet food and beverage options.
Mukta V N Films Limited, carrying on the Programming service business which is jointly held by the Company along with VN Films Private Limited, a subsidiary of UFO Moviez. This business used to have a major contribution in topline though being a commission business, the impact on bottomline was small. As a result of this joint venture, the overall share of the business has grown with over 600 screens being managed by the new entity. Your Company holds 55% of the equity shares of Mukta V N Films Limited and as per provisions Section 2(87) of the Companies Act, 2013 it is a subsidiary company. Since, your Company is a listed Company, Indian Accounting Standard (Ind AS) is applicable with effect from financial year 2017-2018. Since, Mukta V N Films Limited is the result of joint venture between the Company and VN Films Private Limited as per Ind AS, Mukta V N Films Limited is not to be considered as subsidiary but a joint venture company. So, Mukta V N Films Limited is being treated as a joint venture company from the financial year 2017-2018.
Another subsidiary of the Company, Connect.1 Limited has for some time been entrusted with monetising the entire groupâs content on all digital platforms since 2012. It has also curated & syndicated the content emerging from WWI (mostly in the nature of student fiction short films) on YouTube and Dailymotion. Connect.1 has produced a slate of widely viewed short films on the You Tube channel which received good feedback. This has led the company to establish links and partnership with all major platforms to ensure its content is well distributed.
Mukta Tele Media Limited is another subsidiary of the Company. The main objects of the Company are to take up production of TV-serials, management of event shows and entertainment software.
Another subsidiary of the Company, Mukta Creative Ventures Limited (formerly known as Coruscant Tec Limited) is abased mobile solutions company with a focus on content, applications and commerce, having office in Mumbai.
During the year, the Board of Directors reviewed the affairs of its subsidiary Companies. Further, pursuant to provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Company''s subsidiaries in Form AOC-1 is attached as Annexure A to this Report.
Pursuant to Section 136 of the Act companies are exempted from attaching the Annual Reports and other particulars of its subsidiary companies alongwith Annual Report of the Company. Therefore, the Annual Report of the subsidiary companies are not attached with this Annual Report.
Any member desirous of obtaining a copy of the said financial statements may write to the Company Secretary at the registered office address of the Company.
3. CORPORATE GOVERNANCE
Corporate Governance is an ethically driven business process that is committed to values aimed at enhancing an organizationâs brand and reputation. This is ensured by taking ethical business decisions and conducting business with a firm commitment to values, while meeting stakeholders'' expectations. The Company has been following the principles of good Corporate Governance over the years and lays strong emphasis on transparency, accountability and integrity. As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance alongwith the Certificate from Practicing Company Secretary confirming the compliance, is attached as Annexure F to this Report
Number of meetings of the board
The details of the number of meetings of the Board held during the financial year 2017-18 forms part of the Corporate Governance Report. The Company had 4 meetings of the Board during the year. The intervening gap between any two meetings was within the period prescribed by Regulation-17(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013.
Committees of the Board
Currently the Board has four Committees namely Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee and Share Transfer Committee.
A detailed note on Board and its committees is provided under the corporate governance section to this annual report. The composition of Committees, as per the applicable provisions of the Act and Rules, are as follows:
S.No. |
Name of the Committee |
Composition of the Committee |
1. |
Audit Committee |
1. Mr. Kewal Handa 2. Mr. Parvez A.Farooqui 3. Mr. Manmohan Shetty |
2. |
Nomination and Remuneration Committee |
1. Mr. Kewal Handa 2. Mrs. Paulomi Dhawan 3. Mr. Mamohan Shetty |
3. |
Stakeholders Relationship Committee |
1. Mr. Kewal Handa 2. Mr. Parvez A.Farooqui 3. Mrs. Paulomi Dhawan |
4. |
Share Transfer Committee |
1. Mr. Parvez A.Farooqui 2. Mr. Kewal Handa 3. Mr. Mamohan Shetty |
Board Diversity
The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage difference in thought, perspectives, knowledge, skill, regional and industry experience, cultural and geographical background. The Board has adopted the Policy on Board Diversity which sets out the approach to diversity of the Board of Directors and the same is available on our website.
Remuneration and Nomination Policy
The Board of Directors of the Company has Independent Directors, who have in depth knowledge of the business and industry as the members of Nomination and Remuneration Committee. The composition of the Board is in conformity with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013.
The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Policy Personnel and Senior Management of the Company. This Policy also lays down criteria for selection and appointment of Board Members. The policy attached as Annexure B to this Board''s Report.
Declaration by Independent Directors
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013.
Board evaluation
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration of the various aspects of the Board''s functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.
The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The performance evaluation of the Chairman and the Non- Independent Director(s) was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.
None of the independent directors are due for re- appointment.
Directors and Key Managerial Personnel
The Company has following Key Managerial Personnel:
Sr. No. |
Name of the Person |
Designation |
1 |
Mr. Subhash Ghai |
Executive Chairman |
2 |
Mr. Rahul Puri |
Managing Director |
3 |
* Mr. Parvez Faroqui |
Non-Executive Director |
4 |
Mr. Prabuddha Dasgupta |
Chief Financial Officer |
5 |
Ms. Monika Shah |
Company Secretary |
* Mr. Parvez Farooqui was Executive Director and KMP for the period from 01st April 2017 to 31st May 2017
Certificate on Corporate Governance
Mr. Pratik M. Shah, Practicing Company Secretary has certified the Companyâs Compliance of the requirements of Corporate Governance in terms of Regulation 27 (2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the financial year ended 31st March, 2018 and the same is enclosed as an Annexure D to the Report on Corporate Governance.
Directorâs responsibility statement
To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013:
i. in the preparation of the annual accounts for the year ended 31st March, 2018, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
ii. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the year ended on that date;
iii. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
iv. the annual accounts have been prepared on a going concern basis;
v. that the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
vi. that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
4. AUDIT AND AUDITORS
Statutory Auditors
M/s Uttam Abuwala & Co., Chartered Accountants were re-appointed as the Statutory Auditors of the Company to hold office for a period of 4 years till the conclusion of the Thirty Eighth Annual General Meeting of the Company to be held in the year 2020.
The Companyâs explanation to the Auditorsâ observation in their Report have been detailed in Note Noâs 42, 45, 46 and 49 in the notes forming part of accounts which forms part of the Annual Report.
Secretarial Audit
Pursuant to provisions of Section 204(1) of the Companies Act, 2013 read with rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed K. C. Nevatia & Associates, Company Secretaries in Practice (C. P. No. 2348) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report of the Company for the year ended is attached as Annexure C.
Directors Explanation to Qualification in Secretarial Audit Report:
a) Excess remuneration and professional fees paid to Mr. Subhash Ghai, erstwhile chairman and Managing Director of the company has been taken up at suitable level for review and the company is hopeful of getting the relief shortly.
b) As adhering to the terms of the order passed by Bombay High Court, the Company has paid an amount of Rs. 11,35,38,000/- to (Mahrashtra Film Stage and Cultural Development Corporation) MFCCDCL by March 31, 2018. The State Govt. and MFSCDCL challenged the said order of the High Court in the Supreme Court which application was dismissed by the Supreme Court on 22 September 2014. The amount so paid / being paid by the holding company have been accounted under Non-Current Other Financial Assets in the Financial Statements to be adjusted on the settlement of the case. Management of WWIL informs that these will be accounted as an expense, if required, on the settlement of the case.
Significant and material orders passed by the regulators or courts
There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations.
Internal Financial control systems and their adequacy
Your Company has an effective internal financial control and risk mitigation system, which are constantly assessed and strengthened with new/ revised standard operating procedures. The Companyâs internal control system is commensurate with its size, scale and complexities of its operations. The internal and operational audit is entrusted to M/s. Garg Devendra & Associates, a reputed firm of Chartered Accountants. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.
The Audit Committee actively reviews the adequacy and effectiveness of the internal financial control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism.
The Audit Committee, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken by the management are presented to the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee.
Extract of Annual Return
The details forming part of the extract of Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and administration) Rules, 2014, is attached as Annexure E and forms an integral part of this Report.
5. Human Resources
Human Resource is considered as one of the most critical resources in the business which can be continuously smoothened to maximize the effectiveness of the Organization. Human Resources build the Enterprise and the sense of belonging would inculcate the spirit of dedication and loyalty amongst them towards strengthening the Companyâs Polices and Systems. All personnel continue to have healthy, cordial and harmonious approach thereby enhancing the contributory value of the Company.
The Company is committed to nurturing, enhancing and retaining top talent through superior Learning and Organizational Development.
Further statutory disclosures w.r.t. Human Resources are as under:
i) As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has formulated and implemented a policy on Sexual Harassment at workplace with a mechanism of lodging complaints. Its redressal is placed on the intranet for the benefit of its employees. During the year under review, no complaints were reported to the Board.
ii) The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:
a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:
Name |
Designation |
Ratio |
Mr. Subhash Ghai |
Executive Chairman |
13.88 |
Mr. Rahul Puri |
Managing Director |
16.98 |
*Mr. Parvez A. Farooqui |
Non-Executive Director |
NA |
* Since Mr. Parvez Farooqui is a non-executive Director he did not receive any remuneration with effect from 01.06.2017
b. The percentage increase in remuneration of each director, chief executive officer, chief financial officer, company secretary in the financial year:
Name |
Designation |
%increase / decrease |
Mr. Subhash Ghai |
Executive Chairman |
62% |
Mr. Rahul Puri |
Managing Director |
10% |
Mr. Parvez A. Farooqui |
Non- Executive Director |
- (10% increase is for to months from 01st April 2017 to 31st May 2017 |
Mr. Prabuddha Dasgupta |
Chief Financial Officer |
10% |
Ms. Monika Shah |
Company Secretary |
5% |
c. The percentage increase in the median remuneration of employees in the financial year:- 120%
d. The number of permanent employees on the rolls of Company: - 66
e. Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:
Average percentage increase made in the salaries of Employees other than the managerial personnel in the financial year was 26.22% whereas the increase in the managerial remuneration was -2.91%.
f. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company affirms remuneration is as per the remuneration policy of the Company.
g. Particulars of Employees
Information as per Rule 5(2) of Chapter XIII, Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
Top Ten Employees in terms of remuneration drawn during the year
Sr. No. |
Name |
Designation / Nature of Duties |
Remuneration |
Qualification |
Experience (in years) |
Date of Commencement of Employment |
Age (in years) |
Last Employment Held |
Relative of any Director and Manger of the Company |
1 |
Subhash Krishandayal Ghai |
Executive Chairman |
5,820,000 |
B.Com |
47 |
09.07.1982 |
74 |
Mukta Arts Since inception |
No |
2 |
Rahul V Puri |
Managing Director |
4,177,800 |
Bsc- Business Management |
19 |
01.04.2004 |
40 |
Nimbus Communications Ltd. |
* Yes |
3 |
Prabuddha Dasgupta |
Chief Financial Officer |
3,811,308 |
CA |
26 |
07.07.2014 |
50 |
Neo Sports broadcast Pvt. Ltd. |
No |
4 |
Siraj Farooqui |
Studio Chief Executive |
3,406,260 |
Inter Arts |
42 |
01.11.2015 |
63 |
Mukta Arts Since inception |
*Yes |
5 |
Sanjay Ghai |
Chief Operating Officer |
3,054,000 |
Graduate |
35 |
09.01.2008 |
52 |
Mukta Shakti Combine |
No |
6 |
Ashish Gharde |
Group Chief Operating Officer |
3,999,996 |
MBA (SIBM) |
21 |
06.02.2017 |
45 |
Larsen & Toubro and Balaji Telefilms Limited |
No |
7 |
Prem Taparia |
Manager- Finance |
2,303,892 |
CA |
14 |
39 |
Simplex Mills Co. Ltd. |
No |
|
8 |
Rekha Misra |
VP- Projects & Adm. |
1,350,480 |
B.Com |
36 |
01.11.2016 |
66 |
Great eastern Shipping Co. |
No |
9 |
Cornelia Thallinger |
EA to Chairman |
1,025,058 |
MBA in communications |
8 |
16.02.2016 |
30 |
DSB international school, Mumbai |
No |
10 |
Monika Shah |
Company Secretary |
944,100 |
CS , LLB |
12 |
25.01.2016 |
38 |
B. Raheja Builders |
No |
Details of Employees who were :
(A) Employed throughout the Financial Year under review and in receipt of remuneration for the Financial Year in the aggregate of not less than Rs. 1,02,00,000 per annum: NIL
(B) Employed for the part of the Financial Year under review and in receipt of remuneration at the rate of not less than Rs. 8,50,000/- per month : NIL
There was no employee either throughout the financial year or part thereof who was in receipt of remuneration which in the aggregate was in excess of that drawn by the Managing Director or Whole-time Director and who held by himself or alongwith his spouse or dependent children two percent or more of the Equity Shares of the Company.
* Mr. Rahul Puri is relative of Mr. Subhash Ghai
* Mr. Siraj Farooqui is relative of Mr. Parvez Farooqui.
6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section forming part of the Annual Report.
7. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement to report genuine concerns or grievances. The Vigil Mechanism/ Whistle Blower Policy may be accessed on the Company''s website http://muktaarts.com/Aboutus/investorrelations.php
8. RISK MANAGEMENT
Your Company is well aware of risks associated with its business. The Company manages risk through a detailed Risk Management Policy framework which lays down guidelines in identifying, assessing and managing risks that the businesses are exposed to.
9. HEALTH, SAFETY AND ENVIRONMENT:
As a responsible corporate citizen, your Company lays considerable emphasis on health, safety aspects of its human capital, operations and overall working conditions. Thus being constantly aware of its obligation towards maintaining and improving the environment, all possible steps are being taken to meet the toughest environmental standards on pollution, effluents, etc. across various spheres of its business activities.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company is not engaged in manufacturing activities and as such the particulars relating to conservation of energy and technology absorption are not applicable. The Company makes every effort to conserve energy as far as possible in its post-production facilities, Studios, Offices, etc. In particular the Company has taken specific measures to ensure conservation of energy in places where Mukta A2 Cinemas are located.
Particulars regarding Foreign Exchange earnings and outgo required under the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are given in the notes forming part of accounts which forms part of the Annual Report.
11. GREEN INITIATIVE
Section 136 of the Act and the Rules framed there under allows the Company to send its Financial Statements by electronic mode to such Members whose shareholding is in dematerialized format and whose email addresses are registered with the Depositories for communication purposes. As a responsible corporate citizen, the Company proposes to effect electronic delivery of the Annual Report of the Company in lieu of the paper form to the Members who have registered their email IDs with the Depositories. A physical copy of the Annual Report will be sent to those Members who have not registered their email addresses with the Depositories for receiving electronic communication. A physical copy of this Annual Report can also be obtained free of cost by any Member from the Registered Office of the Company on any working day during business hours.
A copy of this Annual Report is also available on the website of the Company at www.muktaarts.com.
12. STATUTORY INFORMATION
The Business Responsibility Reporting as required by Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable to your Company for the financial year ended March 31, 2018.
13. ACKNOWLEDGEMENTS
Your Directors express their deep sense of gratitude to the Artistes, Technicians, film distributors, exhibitors, Bankers, stakeholders and business associates for their co-operation and support and look forward to their continued support in future.
Your Directors also place on record, their appreciation for the contribution, commitment and dedication to your Companyâs performance by the employees of the Company at all levels.
For and on behalf of the Board of Directors of
Mukta Arts Limited
Subhash Ghai
Place: Mumbai Executive Chairman
Date: 24th May, 2018 DIN: 00019803
Mar 31, 2016
BOARDâS REPORT
To the Members,
The Directors take pleasure in presenting the Thirty Fourth Annual Report together with the Audited Statement of Accounts of the Company for the financial year ended 31st March, 2016.
1. RESULTS OF OUR OPERATIONS
Figures in Millions
Particulars |
Year ending 31.03.2016 (Rs.) |
Year ending 31.03.2015 (Rs.) |
Profit/(Loss) before interest, depreciation & tax |
102.81 |
66.07 |
Less: Interest |
58.65 |
77.09 |
Profit/(Loss) after interest, before depreciation & tax |
44.15 |
-11.02 |
Less: Depreciation |
61.69 |
66.22 |
Profit/(Loss) before tax |
-17.53 |
-77.24 |
Less: Provision for taxation |
0 |
0 |
Deferred Tax Liability /(Asset) |
1.52 |
-7.33 |
Profit/(Loss) available for appropriation |
-19.05 |
-69.91 |
Less: Interim / Final Dividend |
0 |
0 |
Tax on Interim / Final Dividend |
0 |
0 |
Profit/(Loss) for the year |
-19.05 |
-69.91 |
Add: Balance brought forward |
-50.5 |
22.48 |
Less: Transfer to general reserve |
0 |
0 |
Profit/(Loss) Carried forward to Balance Sheet |
-69.55 |
-50.50 |
Companyâs Performance
During the year the total revenues of the Company were placed at Rs. 618.404 Millions compared to Rs. 1112.91 Millions last year.
The Companyâs performance and outlook has been discussed in detail in the Management Discussion and Analysis.
The Company and Whistling Woods International Ltd. had filed applications at the Bombay High Court to review its order dated 9th February, 2012 and after detailed hearing the Review Petition was admitted and a stay was granted by order dated 30th July 2014. However, as an interim arrangement the High Court has ordered the Petitioner to deposit with Maharashtra Film, Stage and Cultural Development Corporation Limited (âMFSCDCLâ) against the arrears of rent for the years 2000-01 to 2013-14 aggregating to Rs 100,038,000 by January 2015 and pay rent of Rs. 4,500,000 per annum from the year financial 2014-15, pending disposal of the review petition. The State Government of Maharashtra and MFSCDCL had challenged the Order of the High Court in the Supreme Court, this special leave petition was dismissed by the Supreme Court on 22nd September 2014.
Dividend
In view of losses, the Directors regret their inability to recommend dividend for the financial year ended 31st March 2016.
Particulars of loans, guarantees or investments by company
Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to Financial Statements.
Fixed Deposits
The Company has not accepted any deposits, within the meaning of section 73 of the Companies Act, 2013 read with the Companies (Acceptance of deposits) Rules, 2014.
Particulars of Contracts or arrangements made with related party (ies)
All transactions entered with Related Parties for the year under review were on armâs length basis and in the ordinary course of business and that the provisions of sections 188 of the Companies Act, 2013 are not attracted. Thus, disclosure in Form AOC-2 is not required. Further, there are no material related party transactions during the year under review with Promoters, Directors or Key Managerial Personnel. The Company has developed a Related Party Transactions framework through Standards Operating Procedures for the purpose of identification and monitoring of such transactions.
All Related Party Transactions are placed before the Audit Committee as also before the Board for approval. The Policy on Related Party Transactions as approved by the Board of Directors has been uploaded on the website of the Company. The web link of the same has been provided in the Corporate Governance Report. None of the Directors has any pecuniary relationship or transactions vis-a-vis the Company.
Material changes and commitment, if any, affecting the financial position of the company occurred between the end of the financial year to which this financial statements relate and the date of the report
Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company''s financial position have occurred between the end of the financial year of the Company and date of this report.
Share Capital
During the year under review, there was no change in the share capital of the Company.
2. BUSINESS OVERVIEW
Your Company has for the past two years, been focusing increasingly on the Cinema business. Over the years the Company has built up a dedicated clientele with its offering of affordable luxury where the patron gets a world class experience at par with any of India''s other top multiplexes, but at a distinctly more affordable value. The Company is expanding internationally and its premium 6 screen multiplex theatre in Bahrain will open in August this year. In addition, the company has opened multiple properties across India and many more will follow.
During this fiscal year, the Company has continued to monetize rights of old hit films from its sizeable library.
The company has also successfully launched its digital company Connect One and has already produced a number of short films specifically for the internet medium to good response. The company continues to partner with the best platforms to ensure that we build strongly on this success.
Development of a new slate of feature films has also begun and the Company is confident of these beginning at the end of the year.
Subsidiary Companies
As on 31.03.2016 we have five Indian subsidiary Companies namely, Whistling Woods International Limited, Connect.1 Limited, Mukta Tele Media Limited, Coruscant Tec Private Limited and Mukta V N Films Limited. There is no material subsidiary of the company within the meaning of Regulation 27 and 30 of the Listing Agreement.
Out of the subsidiaries of the Company, the most notable has been the Whistling Woods International Limited (âWWI'') that has regularly been rated as one of the Ten Best Film Schools in the World by âThe Hollywood Reporter'', partnering with global brands like Bradford College, Sony, Apple & many more and with its alumni earning laurels in India & globally. In the field of Digital Content Creation and education thereof, Whistling Woods is now partnering with Google and has set up India''s first and Asia''s 2nd âYouTube Space''. WWI has also entered into a historic partnership with the Tata Institute of Social Sciences'' School of Vocational education to accredit all the 3-year UG courses that WWI runs with BSc, BA & BBA degrees. This has seen a sizeable growth in the admissions of students and will be able to take the institutes capacity to close to 900 students. Academically, WWI has started its School of Music with a 2-yr Diploma in Music Production & Composition and will be going to market with its first foray into online education with a âFoundation in Film-making'' course under the WWI Virtual Academy. In addition WWI has partnered with Foxconn to open a state of the art media lab in the institute which was inaugurated with great fanfare.
Another subsidiary of the Company, Connect.1 Limited has for some time been entrusted with monetizing the entire group''s content on all digital platforms since 2012. It has also curated & syndicated the content emerging from WWI (mostly in the nature of student fiction short films) on YouTube and Dailymotion. Connect.1 is being elevated as a visible sub-brand within Mukta Arts as a Digital Studio & Multi-Channel network. Connect 1 has produced a slate of widely viewed short films on the You Tube channel which received good feedback. This has led the company to establish links and partnership with all major platforms to ensure its content is well distributed.
Mukta Tele Media Limited is another subsidiary of the Company. The main objects of the Company are to take up production of tele-serials, management of event shows and entertainment software.
Another subsidiary of the Company, Coruscant Tec Limited is a Mumbai (India) based mobile solutions company with a focus on content, applications and commerce, having office in Mumbai. The company has in a short period of time forged alliances with several leading Indian and international aggregators, telecom operators(telcos), financial networks and banks to bring mobile content and commerce to Indian mobile subscribers-one of the fastest growing telecom markets in the world thereby reaching out to almost 55 million subscribers in GSM and CDMA segments.
The Programming service business has from April 2014, been carried over by our subsidiary, Mukta VN Films Limited, which is jointly held by the Company along with VN Films Private Limited, a subsidiary of UFO Moviez. This business used to have a major contribution in topline though being a commission business, the impact on bottom-line was small. As a result of this joint venture, the overall share of the business has grown with over 600 screens being managed by the new entity.
During the year, the Board of Directors reviewed the affairs of its subsidiary Companies. Further, pursuant to provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of the Companyâs subsidiaries in Form AOC-1 is attached as Annexure âAâ to this Report.
Your Company has also invested in a Single Person Company (SPC) named âMUKTA A2 MULTIPLEX S.P.Câ, registered in the Kingdom of Bahrain which runs a multiplex in Bahrain. With this, your Company has ventured into international markets in multiplex business sector.
3. CORPORATE GOVERNANCE
Corporate Governance is an ethically driven business process that is committed to values aimed at enhancing an organizationâs brand and reputation. This is ensured by taking ethical business decisions and conducting business with a firm commitment to values, while meeting stakeholdersâ expectations. The Company has been following the principles of good Corporate Governance over the years and lays strong emphasis on transparency, accountability and integrity. As per Regulation 27 (2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate section on Corporate Governance forms part of this Annual Report.
Number of meetings of the board
The details of the number of meetings of the Board held during the financial year 2015-16 forms part of the Corporate Governance Report. The intervening gap between any two meetings was within the period prescribed by Regulation-17(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the Companies Act, 2013.
Committees of the Board
Currently the Board has five Committees namely Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Share Transfer Committee and Risk Management Committee.
A detailed note on Board and its committees is provided under the corporate governance section to this annual report. The composition of Committees, as per the applicable provisions of the Act and Rules, are as follows:
S.No. |
Name of the Committee |
Composition of the Committee |
1. |
Audit Committee |
1. Mr. Parvez A.Farooqui 2. Mr. Kewal Handa 3. Mr. Manmohan Shetty |
2. |
Nomination and Remuneration Committee |
1. Mrs. Paulomi Dhawan 2. Mr. Kewal Handa 3. Mr. Manmohan Shetty |
3. |
Stakeholders Relationship Committee |
1. Mr. Parvez A.Farooqui 2. Mr. Kewal Handa 3. Mrs. Paulomi Dhawan |
4. |
Share Transfer Committee |
1. Mr. Parvez A.Farooqui 2. Mr. Kewal Handa 3. Mr. Manmohan Shetty |
5. |
Risk Management Committee |
1. Mr. Parvez A.Farooqui 2. Mr. Kewal Handa 3. Mrs. Paulomi Dhawan |
Board Diversity
The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage difference in thought, perspectives, knowledge, skill, regional and industry experience, cultural and geographical background. The Board has adopted the Policy on Board Diversity which sets out the approach to diversity of the Board of Directors and the same is available on our website.
Remuneration and Nomination Policy
The Board of Directors of the Company has Non-Executive Independent Directors, who have in depth knowledge of the business and industry as the members of Nomination and Remuneration Committee. The composition of the Board is in conformity with the Listing Agreement and the Stock Exchanges and Companies Act, 2013.
The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors, Key Managerial Policy Personnel and Senior Management of the Company. This Policy also lays down criteria for selection and appointment of Board Members. The policy is attached as Annexure - B to the Boardâs Report.
Declaration by Independent Directors
All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 17(1 )(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
Board evaluation
Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a structured questionnaire was prepared after taking into consideration of the various aspects of the Boardâs functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance.
The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The performance evaluation of the Chairman and the non- independent Director(s) was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the evaluation process.
None of the independent directors are due for re- appointment.
Directors and Key Managerial Personnel
The Company has following Key Managerial Personnel:
Sr. No. |
Name of the Person |
Designation |
1 |
Mr. Subhash Ghai |
Executive Chairman |
2 |
Mr. Rahul Puri |
Managing Director |
3 |
Mr. Parvez A. Farooqui |
Executive Director |
4 |
Mr. Prabuddha Dasgupta |
Chief Financial Officer |
5 |
Ms. Monika Shah |
Company Secretary |
Certificate on Corporate Governance
A Practicing Company Secretary has certified the Companyâs Compliance of the requirements of Corporate Governance in terms of Regulation 27 (2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same is enclosed as an Annexure to the Report on Corporate Governance.
Directors responsibility statement
To the best of knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 134(3)(c) of the Companies Act, 2013:
i. in the preparation of the annual accounts for the year ended 31st March, 2016, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;
ii. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for the year ended on that date;
iii. the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
iv. the annual accounts have been prepared on a going concern basis;
v. that the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
vi. that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
4. AUDIT AND AUDITORS
Statutory Auditors
M/s Uttam Abuwala & Co., Chartered Accountants have been appointed as the Statutory Auditors of the Company to hold office till the conclusion of the 34th Annual General Meeting through postal ballot report of 16.10.2015. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be subject to ratification at every Annual General Meeting. Since, the appointment was made through postal ballot, the approval of members by ratification in the AGM is not required and hence the re-appointment of M/s Uttam Abuwala & Co, Chartered Accountants, as Statutory Auditors of the Company is to be taken at the Annual General Meeting of the Company. In this regard, Auditors have confirmed their eligibility and submitted the Certificate in writing that their appointment, if ratified, would be within the prescribed limit under the Act and they are not disqualified for re-appointment.
The Companyâs explanation to the Auditorsâ observation in their Report have been detailed in Note No.s 3.40 and 3.41 in the notes forming part of accounts which forms part of the Annual Report.
Secretarial Audit
Pursuant to provisions of Section 204(1) of the Companies Act, 2013 read with rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed M/s. K. C. Nevatia & Associates, a firm of Company Secretaries in Practice (C. P. No. 2348) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is included as Annexure C and forms an integral part of this Report.
Certificate on Corporate Governance
Your Company has taken adequate steps to adhere to all the stipulations laid down in SEBI Listing Regulations.
A Report on Corporate Governance is included as a part of this Annual Report. Certificate from a Practicing Company Secretary, M/s K. C. Nevatia & Associates confirming the compliance with the conditions of Corporate Governance as per SEBI Listing Regulations is included as Annexure - D of this Report.
Directors Explanation to Qualification in Secretarial Audit Report:
a) Excess remuneration and professional fees paid to Mr. Subhash Ghai, erstwhile chairman and Managing Director of the company has been taken up at suitable level for review and the company is hopeful of getting the relief shortly.
b) Attempts continue to be made to pay statutory dues on time and file the relevant returns within prescribed time limits.
c) As adhering to the terms of the order passed by Bombay High Court, the Company has paid an amount of Rs. 10,90,38,000/- to (Mahrashtra Film Stage and Cultural Development Corporation) MFCCDCL by March 31, 2016. The State Govt. and MFSCDCL challenged the said order of the High Court in the Supreme Court which application was dismissed by the Supreme Court on 22 September 2014. The amount so paid / being paid by the Company have been treated as Deposit in the Financial Statements and the same will be adjusted accordingly upon settlement of the case.
Significant and material orders passed by the regulators or courts
There are no significant and material orders passed by the Regulators/Courts that would impact the going concern status of the Company and its future operations.
Internal control systems and their adequacy
Your Company has an effective internal control and risk mitigation system, which are constantly assessed and strengthened with new/ revised standard operating procedures. The Company''s internal control system is commensurate with its size, scale and complexities of its operations. The internal and operational audit is entrusted to M/s. Garg Devendra & Associates, a reputed firm of Chartered Accountants. The main thrust of internal audit is to test and review controls, appraisal of risks and business processes, besides benchmarking controls with best practices in the industry.
The Audit Committee actively reviews the adequacy and effectiveness of the internal control systems and suggests improvements to strengthen the same. The Company has a robust Management Information System, which is an integral part of the control mechanism.
The Audit Committee, Statutory Auditors and the Business Heads are periodically apprised of the internal audit findings and corrective actions taken by the management are presented to the Audit Committee. To maintain its objectivity and independence, the internal Audit function reports to the Chairman of the Audit Committee.
Extract of Annual Return
The details forming part of the extract of Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and administration) Rules, 2014, is included in this Report as Annexure- E and forms an integral part of this Report.
5. HUMAN RESOURCES
Human Resource is considered as one of the most critical resources in the business which can be continuously smoothened to maximize the effectiveness of the Organization. Human Resources build the Enterprise and the sense of belonging would inculcate the spirit of dedication and loyalty amongst them towards strengthening the Company''s Polices and Systems. All personnel continue to have healthy, cordial and harmonious approach thereby enhancing the contributory value of the Company.
The Company is committed to nurturing, enhancing and retaining top talent through superior Learning and Organizational Development.
Further statutory disclosures w.r.t. Human Resources are as under:
i) As required by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has formulated and implemented a policy on Sexual Harassment at workplace with a mechanism of lodging complaints. Its redressal is placed on the intranet for the benefit of its employees. During the year under review, no complaints were reported to the Board.
ii) The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:
a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:
Name |
Designation |
Ratio |
Mr. Subhash Ghai |
Executive Chairman |
52.39 |
Mr. Rahul Puri |
Managing Director |
66.49 |
Mr. Parvez A. Farooqui |
Executive Director |
65.96 |
b. The percentage increase in remuneration of each director, chief executive officer, chief financial officer, company secretary in the financial year:
Name |
Designation |
Ratio |
Mr. Subhash Ghai |
Executive Chairman |
(17.84%) |
Mr. Rahul Puri |
Managing Director |
26.28% |
Mr. Parvez A. Farooqui |
Executive Director |
25.81% |
Mr. Prabuddha Dasgupta |
Chief Financial Officer |
43.08% |
#Mr. Ravi Poplai |
Company Secretary |
Not Applicable |
* Mrs. Monika Shah |
Company Secretary |
Not Applicable |
# Mr. Ravi Poplai has resigned w.e.f. 05/10/2015
* Mrs. Monika Shah joined the Company w.e.f. 10/02/2016
c. The percentage increase in the median remuneration of employees in the financial year:- 66.83%
d. The number of permanent employees on the rolls of Company: - 387
e. The explanation on the relationship between average increase in remuneration and Company performance:
The average increase in remuneration of the employees of the Company was due to following reasons:
1. Number of employees grew from 319 as on 31st March, 2015 to 387 as on 31st March, 2016 as appointments were made for new Cinema locations opened during the period.
2. Increase in remuneration of the existing employees as per industry standards.
3. The Company has reduced its losses during the year ended 31.03.2016.
f. Comparison of the remuneration of the key managerial personnel against the performance of the Company:
Name |
Designation |
CTC (Rs.) |
% Increase in CTC |
PAT (Rs. in Lakhs) |
% Increase in PAT |
Mr. Subhash Ghai |
Executive Chairman |
3,337,400 |
(17.84%) |
(190.51) |
Not |
Mr. Rahul Puri |
Managing Director |
3,554,340 |
26.28% |
|
Applicable |
Mr. Parvez A. Farooqui |
Executive Director |
3,503,426 |
25.81% |
|
|
#Mr. Prabuddha Dasgupta |
Chief Financial Officer |
3,150,000 |
43.08% |
|
|
* Mr. Ravi Poplai |
Company Secretary |
209,880 |
Not Applicable |
|
|
* Mrs. Monika Shah |
Company Secretary |
164,941 |
Not Applicable |
|
|
# Mr. Prabuddha Dasgupta joined the Company w.e.f. 07/07/2014
* Mr. Ravi Poplai has resigned w.e.f. 05/10/2015 and Mrs. Monika Shah joined the Company w.e.f. 10/02/2016
g. Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase or decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer:
Date |
Paid up Capital |
Closing Market Price per shares |
EPS |
PE Ratio |
Market Capitalisation (Rs. in Lakhs) |
31.03.2015 |
112,906,000 |
*29.70 |
(3.01) |
(9.58) |
6706.62 |
31.03.2016 |
112,906,000 |
*58.80 |
(0.84) |
(70) |
13277.75 |
Increase/ Decrease |
Nil |
29.10 |
2.26 |
60.42 |
6571.13 |
% Increase/ Decrease |
Nil |
97.98 |
75.08 |
630.69 |
97.98 |
No issue of shares during the year |
-- |
-- |
-- |
-- |
-- |
*Market price data as per NSE is considered.
h. Average percentage increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:
Average percentage increase made in the salaries of Employees other than the managerial personnel in the financial year was 33.06% whereas the increase in the managerial remuneration was 41.00%.
i. The key parameters for any variable component of remuneration availed by the directors:
Not Applicable.
j. The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year:
Not Applicable.
k. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company affirms remuneration is as per the remuneration policy of the Company.
iii) Information as per Rule 5(2) of Chapter XIII, Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
(a) & (b) There were no employees drawing remuneration of Rs. 60 lacs or more per annum, employed throughout the financial year and drawing Rs. 5 lacs or more per month if employed for part of the financial year during the financial year under review.
(c) there is no employee holding by himself or along with his spouse and dependent children, 2% or more of the Equity shares of the Company and drawing the aggregate remuneration in excess of that drawn by the Managing Director or Whole-Time Director or Manager.
6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is presented in a separate section forming part of the Annual Report.
7. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Vigil Mechanism of the Company, which also incorporates a whistle blower policy in terms of the Listing Agreement to report genuine concerns or grievances. The Vigil Mechanism/ Whistle Blower Policy may be accessed on the Companyâs website http://muktaarts.com/Aboutus/investorrelations.php
8. RISK MANAGEMENT
Your Company is well aware of risks associated with its business. The Company manages risk through a detailed Risk Management Policy framework which lays down guidelines in identifying, assessing and managing risks that the businesses are exposed to. Risk is managed by the Board/Risk Management Committee of the Board through appropriate structures that are in place at the Company.
9. HEALTH, SAFETY AND ENVIRONMENT:
As a responsible corporate citizen, your Company lays considerable emphasis on health, safety aspects of its human capital, operations and overall working conditions. Thus being constantly aware of its obligation towards maintaining and improving the environment, all possible steps are being taken to meet the toughest environmental standards on pollution, effluents, etc. across various spheres of its business activities.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company is not engaged in manufacturing activities and as such the particulars relating to conservation of energy and technology absorption are not applicable. The Company makes every effort to conserve energy as far as possible in its post-production facilities, Studios, Offices, etc. In particular the Company has taken specific measures to ensure conservation of energy in places where Mukta A2 Cinemas are located.
Particulars regarding Foreign Exchange earnings and outgo required under the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are given in the notes forming part of accounts which forms part of the Annual Report.
11. GREEN INITIATIVE
Section 136 of the Act and the Rules framed there under allows the Company to send its Financial Statements by electronic mode to such Members whose shareholding is in dematerialized format and whose email addresses are registered with the Depositories for communication purposes. As a responsible corporate citizen, the Company proposes to effect electronic delivery of the Annual Report of the Company in lieu of the paper form to the Members who have registered their email IDs with the Depositories. A physical copy of the Annual Report will be sent to those Members who have not registered their email addresses with the Depositories for receiving electronic communication. A physical copy of this Annual Report can also be obtained free of cost by any Member from the Registered Office of the Company on any working day during business hours.
A copy of this Annual Report is also available on the website of the Company at www.muktaarts.com.
12. STATUTORY INFORMATION
The Business Responsibility Reporting as required by Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable to your Company for the financial year ended March 31, 2016.
13. ACKNOWLEDGEMENTS
Your Directors express their deep sense of gratitude to the Artistes, Technicians, film distributors, exhibitors, Bankers, stakeholders and business associates for their co-operation and support and look forward to their continued support in future.
Your Directors also place on record, their appreciation for the contribution, commitment and dedication to your Company''s performance by the employees of the Company at all levels.
For and on behalf of the Board of Directors of
Mukta Arts Limited
Place: Mumbai Subhash Ghai
Date: 26th May, 2016 Executive Chairman
DIN: 00019803
Mar 31, 2015
Dear Members,
The Directors take pleasure in presenting the Thirty Third Annual
Report together with the Audited Statement of Accounts of the Company
for the financial year ended 31st March, 2015.
1. RESULTS OF OUR OPERATIONS
(Figures in millions)
Particulars Year ending Year ending
31.03.2015 31.03.2014
(Rs.) (Rs.)
Profit/(Loss) before interest,
depreciation & tax 66.07 85.28
Less: Interest 77.09 61.88
Profit/(Loss) after interest, before
depreciation & tax (11.02) 23.40
Less: Depreciation 66.22 42.06
Profit/(Loss) before tax (77.24) (18.66)
Less: Provision for taxation 0.00 0.00
Deferred Tax Liability/(Asset) (7.33) 3.45
Profit/(Loss) available for
appropriation (69.91) (15.21)
Less: Interim / Final Dividend 0.00 0.00
Tax on Interim / Final Dividend 0.00 0.00
Profit/(Loss) for the year (69.91) (15.21)
Add: Balance brought forward 22.48 37.69
Less: Transfer to general reserve 0.00 0.00
Profit/(Loss) Carried forward to
Balance Sheet (47.43) 22.48
Company's Performance
During the year the total revenues of the Company were placed at Rs.
1112.91 Millions compared to Rs. 2960.91 Millions last year.
The Company's performance and outlook has been discussed in detail in
the Management Discussion and Analysis.
The Company and Whistling Woods International Ltd. had filed
applications at the Bombay High Court to review its order dated 9th
February, 2012 and after detailed hearing the Review Petition was
admitted and a stay was granted on 30th July 2014. However, as an
interim arrangement the High Court has ordered the Petitioner to
deposit with Maharashtra Film, Stage and Cultural Development
Corporation Limited ('MFSCDCL') the arrears of rent for the years
2000-01 to 2013-14 aggregating to Rs 100,038,000 by January 2015 and
pay rent of Rs. 4,500,000 per annum from the year financial 2014-15,
pending disposal of the review petition. The State Government of
Maharashtra and MFSCDCL had challenged the Order of the High Court in
the Supreme Court, this special leave petition was dismissed by the
Supreme Court on 22nd September 2014.
Dividend
In view of losses, the Directors regret their inability to recommend
dividend for the financial year ended 31st March 2015.
Particulars of loans, guarantees or investments by company
Details of Loans, Guarantees and Investments covered under the
provisions of Section 186 of the Companies Act, 2013 are given in the
notes to Financial Statements.
Fixed Deposits
The Company has not accepted any deposits, within the meaning of
section 73 of the Companies Act, 2013 read with the Companies
(Acceptance of deposits) Rules, 2014.
Particulars of Contracts or arrangements made with related party (ies)
All transactions entered with Related Parties for the year under review
were on arm's length basis and in the ordinary course of business and
that the provisions of sections 188 of the Companies Act, 2013 are not
attracted. Thus, disclosure in Form AOC-2 is not required. Further,
there are no material related party transactions during the year under
review with Promoters, Directors or Key Managerial Personnel. The
Company has developed a Related Party Transactions framework through
Standards Operating Procedures for the purpose of identification and
monitoring of such transactions.
All Related Party Transactions are placed before the Audit Committee as
also before the Board for approval. The Policy on Related Party
Transactions as approved by the Board of Directors has been uploaded on
the website of the Company. The web link of the same has been provided
in the Corporate Governance Report. None of the Directors has any
pecuniary relationship or transactions vis-a-vis the Company.
Material changes and commitment, if any, affecting the financial
position of the company occurred between the end of the financial year
to which this financial statements relate and the date of the report
Except as disclosed elsewhere in this report, no material changes and
commitments which could affect the Company's financial position have
occurred between the end of the financial year of the Company and date
of this report.
Share Capital
During the year under review, there was no change in the share capital
of the Company.
2. BUSINESS OVERVIEW
Your Company has for the past two years, been focusing increasingly on
the Cinema business. Over the years the Company has a dedicated
clientele with its offering of affordable luxury where the patron gets
a luxurious experience at par with any of India's other multiplexes,
but at a distinctly more affordable value.
During this fiscal year, the Company has released two of its own
productions, Hindi Feature film Kaanchi and Punjabi feature film Double
Di Trouble. The Company has also started monetizing rights of old hit
films from its sizeable library. The Distribution business of the
Company continues to contribute to the topline with nearly 50 movies
distributed in Delhi and East Punjab regions during the year.
The Company is also considering expanding internationally and has
finalised a 6 screen multiplex theatre in Bahrain which it plans to
launch by the end of this calendar year.
Subsidiary Companies
As on 31.03.2015 we have five subsidiary Companies namely, Whistling
Woods International Limited, Connect. 1 Limited, Mukta Tele Media
Limited, Coruscant Tec Private Limited and Mukta V N Films Limited.
There is no material subsidiary of the company within the meaning of
Clause 49 of the Listing Agreement.
Of the subsidiaries of the Company, the most notable has been the
Whistling Woods International Limited ('WWI') has regularly been rated
as one of the Ten Best Film Schools in the World by 'The Hollywood
Reporter', partnering with global brands like Bradford College, Sony,
Apple & many more and with its alumni earning laurels in India &
globally. In the field of Digital Content Creation and education
thereof, Whistling Woods is now partnering with Google to set up
India's first and Asia's 2nd 'YouTube Space'. WWI has also entered into
a historic partnership with the Tata Institute of Social Sciences'
School of Vocational education to accredit all the 3-year UG courses
that WWI runs with BSc, BA & BBA degrees. Academically, WWI has started
its School of Music with a 2-yr Diploma in Music Production &
Composition and will be going to market with its first foray into
online education with a 'Foundation in Film-making' course under the
WWI Virtual Academy.
Another subsidiary of the Company, Connect.1 Limited has for some time
been entrusted with monetising the entire group's content on all
digital platforms since 2012. It has also curated & syndicated the
content emerging from WWI (mostly in the nature of student fiction
short films) on YouTube and Dailymotion. Connect.1 is being elevated as
a visible sub-brand within Mukta Arts as a Digital Studio &
Multi-Channel network.
Mukta Tele Media Limited is another subsidiary of the Company. The main
objects of the Company are to take up production of tele-serials,
management of event shows and entertainment software.
Another subsidiary of the Company, Coruscant Tec Private Limited is a
Mumbai (India) based mobile solutions company with a focus on content,
applications and commerce, having office in Mumbai. The company has in
a short period of time forged alliances with several leading Indian and
international aggregators, telecom operators(telcos), financial
networks and banks to bring mobile content and commerce to Indian
mobile subscribers-one of the fastest growing telecom markets in the
world thereby reaching out to almost 55 million subscribers in GSM and
CDMA segments.
The Programming service business has from April 2014, been carried over
by our subsidiary, Mukta VN Films Limited, which is jointly held by the
Company along with VN Films Private Limited, a subsidiary of UFO
Moviez. This business used to have a major contribution in topline
though being a commission business, the impact on bottomline was small.
As a result of this joint venture, the overall share of the business
has grown with over 600 screens being managed by the new entity.
During the year, the Board of Directors reviewed the affairs of its
subsidiary Companies. Further, pursuant to provisions of Section 129(3)
of the Act, a statement containing salient features of the financial
statements of the Company's subsidiaries in Form AOC-1 is attached as
Annexure 'A' to this Report.
3. CORPORATE GOVERNANCE
Corporate Governance is an ethically driven business process that is
committed to values aimed at enhancing an organization's brand and
reputation. This is ensured by taking ethical business decisions and
conducting business with a firm commitment to values, while meeting
stakeholders' expectations. The Company has been following the
principles of good Corporate Governance over the years and lays strong
emphasis on transparency, accountability and integrity. As per clause
49 of the listing Agreement entered into with BSE and NSE, a separate
section on Corporate Governance forms part of this Annual Report.
Number of meetings of the board
The details of the number of meetings of the Board held during the
financial year 2014-15 forms part of the Corporate Governance Report.
The intervening gap between any two meetings was within the period
prescribed by Clause 49 of the Listing Agreement and the Companies Act,
2013.
Committees of the Board
Currently the Board has five Committees namely Audit Committee,
Nomination and Remuneration Committee, Stakeholders Relationship
Committee, Share Transfer Committee and Risk Management Committee.
A detailed note on Board and its committees is provided under the
corporate governance section to this annual report. The composition of
Committees, as per the applicable provisions of the Act and Rules, are
as follows:
S. Name of the Committee Composition of the Committee
No.
1. Audit Committee 1. Mr. Parvez A.Farooqui
2. Mr. Kewal Handa
3. Mr. Mamohan Shetty
2. Nomination and Remuneration 1. Mrs. Paulomi Dhawan
Committee
2. Mr. Kewal Handa
3. Mr. Mamohan Shetty
3. Stakeholders Relationship 1. Mr. Parvez A.Farooqui
Committee
2. Mr. Kewal Handa
3. Mrs. Paulomi Dhawan
4. Share Transfer Committee 1. Mr. Parvez A.Farooqui
2. Mr. Kewal Handa
3. Mr. Mamohan Shetty
5. Risk Management Committee 1. Mr. Parvez A.Farooqui
2. Mr. Kewal Handa
3. Mrs. Paulomi Dhawan
Board Diversity
The Company recognizes and embraces the importance of a diverse board
in its success. We believe that a truly diverse board will leverage
difference in thought, perspectives, knowledge, skill, regional and
industry experience, cultural and geographical background. The Board
has adopted the Policy on Board Diversity which sets out the approach
to diversity of the Board of Directors and the same is available on our
website.
Remuneration and Nomination Policy
The Board of Directors of the Company has Non-Executive Independent
Directors, who have in depth knowledge of the business and industry as
the members of Nomination and Remuneration Committee. The composition
of the Board is in conformity the Listing Agreement with the Stock
Exchanges and Companies Act, 2013.
The Board of Directors has framed a policy which lays down a framework
in relation to remuneration of Directors, Key Managerial Policy
Personnel and Senior Management of the Company. This Policy also lays
down criteria for selection and appointment of Board Members. The
policy is attached as Annexure - B to the Board's Report.
Declaration by Independent Directors
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
Board evaluation
Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
the Listing Agreement, a structured questionnaire was prepared after
taking into consideration of the various aspects of the Board's
functioning, composition of the Board and its Committees, culture,
execution and performance of specific duties, obligations and
governance.
The evaluation of all the directors and the Board as a whole was
conducted based on the criteria and framework adopted by the Board. The
performance evaluation of the Chairman and the non- independent
Director(s) was carried out by the Independent Directors. The Board of
Directors expressed their satisfaction with the evaluation process.
None of the independent directors are due for re- appointment.
Directors and Key Managerial Personnel
In accordance with the provisions of Section 152 of the Companies Act,
2013 and the Company's Articles of Association, Mr. Parvez A. Farooqui
(DIN 00019853) retires by rotation and being eligible, offer himself
for re-appointment at the ensuing Annual General Meeting.
Mr. Parvez A. Farooqui is being re-appointed as Whole time Director (to
be designated as Executive Director) of the Company for a period of
three years with effect from 1st April 2016.
Mrs. Paulomi Dhawan (DIN 01574580) and Mr. Manmohan Shetty (DIN
00013961) were appointed as Additional Directors of the Company with
effect from 13th November, 2014 and hold office upto the date of this
Annual General Meeting . The Company has received letters from members
along with the requisite deposits proposing candidature of Mrs. Paulomi
Dhawan and Mr. Manmohan Shetty for their appointment as Directors at
the ensuing Annual General Meeting. Accordingly, resolutions proposing
appointment of these two Directors forms part of the Notice of the
Annual General Meeting.
Mr. Anil Harish (DIN 00001685) has resigned from directorship of the
Company vide his resignation letter dated 30th September, 2014.
The Company has following Key Managerial Personnel:
Sr. Name of the Person Designation
No.
1 Mr. Subhash Ghai Executive Chairman
2 Mr. Rahul Puri Managing Director
3 Mr. Parvez A. Farooqui Executive Director
4 Mr. Prabuddha Dasgupta Chief Financial Officer
5 Mr. Ravi B. Poplai Company Secretary
Certificate on Corporate Governance
A Practicing Company Secretary has certified the Company's Compliance
of the requirements of Corporate Governance in terms of Clause 49 of
the Listing Agreement and the same is enclosed as an Annexure to the
Report on Corporate Governance.
Directors responsibility statement
To the best of knowledge and belief and according to the information
and explanations obtained by them, your Directors make the following
statement in terms of Section 134(3)(c) of the Companies Act, 2013:
i. in the preparation of the annual accounts for the year ended 31st
March, 2015, the applicable accounting standards have been followed
along with proper explanation relating to material departures, if any;
ii. the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the loss of the
company for the year ended on that date;
iii. the directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of
the company and for preventing and detecting fraud and other
irregularities;
iv. the annual accounts have been prepared on a going concern basis;
v. that the Directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively; and
vi. that the Directors have devised proper systems to ensure
compliance with the provisions of all applicable laws and that such
systems were adequate and operating effectively.
4. AUDIT AND AUDITORS'
Statutory Auditors'
At the Annual General Meeting of the Company held on 27th September,
2014 , M/s B S R & Co. LLP, Chartered Accountants have been appointed
as the Statutory Auditors of the Company to hold office till the
conclusion of the 36th Annual General Meeting. In terms of the first
proviso to Section 139 of the Companies Act, 2013, the appointment of
the auditors shall be subject to ratification at every Annual General
Meeting. Accordingly, the appointment of M/s B S R & Co. LLP, Chartered
Accountants, as Statutory Auditors of the Company is placed for
ratification by the shareholders. In this regard, Auditors have
confirmed their eligibility and submitted the Certificate in writing
that their appointment, if ratified, would be within the prescribed
limit under the Act and they are not disqualified for re-appointment.
The Company's explanation to the Auditors' observation in their Report
have been detailed in Note No.s 3.40 and 3.41 in the notes forming part
of accounts which forms part of the Annual Report.
Secretarial Audit
Pursuant to provisions of Section 204(1) of the Companies Act, 2013
read with rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules 2014, the Company has appointed M/s. K. C.
Nevatia & Associates, a firm of Company Secretaries in Practice (C. P.
No. 2348) to undertake the Secretarial Audit of the Company. The
Secretarial Audit Report is included as Annexure C and forms an
integral part of this Report.
Directors Explanation to Qualification in Secretarial Audit Report:
a) Excess remuneration and professional fees paid to Mr. Subhash Ghai,
erstwhile chairman and Managing Director of the company has been taken
up at suitable level for review and the company is hopeful of getting
the relief shortly.
b) The loans to non-wholly owned subsidiary companies were given under
urgent necessities to enable them to continue business operations
smoothly. The same has been repaid fully during the financial year
2014-15.We propose to avoid the same as far as possible.
c) Attempts continue to be made to pay statutory dues on time and file
the relevant returns within prescribed time limits.
Significant and material orders passed by the regulators or courts
There are no significant and material orders passed by the
Regulators/Courts that would impact the going concern status of the
Company and its future operations.
Internal control systems and their adequacy
Your Company has an effective internal control and risk mitigation
system, which are constantly assessed and strengthened with new/
revised standard operating procedures. The Company's internal control
system is commensurate with its size, scale and complexities of its
operations. The internal and operational audit is entrusted to M/s.
Garg Devendra & Associates, a reputed firm of Chartered Accountants.
The main thrust of internal audit is to test and review controls,
appraisal of risks and business processes, besides benchmarking
controls with best practices in the industry.
The Audit Committee actively reviews the adequacy and effectiveness of
the internal control systems and suggests improvements to strengthen
the same. The Company has a robust Management Information System, which
is an integral part of the control mechanism.
The Audit Committee, Statutory Auditors and the Business Heads are
periodically apprised of the internal audit findings and corrective
actions taken by the management are presented to the Audit Committee.
To maintain its objectivity and independence, the internal Audit
function reports to the Chairman of the Audit Committee.
Extract of Annual Return
The details forming part of the extract of Annual Return in Form MGT-9,
as required under Section 92 of the Companies Act, 2013 read with Rule
12 of the Companies (Management and administration) Rules, 2014, is
included in this Report as Annexure- D and forms an integral part of
this Report.
5. Human Resources
Human Resource is considered as one of the most critical resources in
the business which can be continuously smoothened to maximize the
effectiveness of the Organization. Human Resources build the Enterprise
and the sense of belonging would inculcate the spirit of dedication and
loyalty amongst them towards strengthening the Company's Polices and
Systems. All personnel continue to have healthy, cordial and harmonious
approach thereby enhancing the contributory value of the Company.
The Company is committed to nurturing, enhancing and retaining top
talent through superior Learning and Organizational Development.
Further statutory disclosures w.r.t. Human Resources are as under:
i) As required by the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013, the Company has
formulated and implemented a policy on Sexual Harassment at workplace
with a mechanism of lodging complaints. Its redressal is placed on the
intranet for the benefit of its employees. During the year under
review, no complaints were reported to the Board.
ii) The information required under Section 197 of the Act read with
rule 5(1) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 are given below:
a. The ratio of the remuneration of each director to the median
remuneration of the employees of the Company for the financial year:
Name Designation Ratio
Mr. Subhash Ghai Executive Chairman 112.71
Mr. Rahul Puri Managing Director 78.09
Mr. Parvez A. Farooqui Executive Director 77.26
b. The percentage increase in remuneration of each director, chief
executive officer, chief financial officer, company secretary in the
financial year:
Name Designation Ratio
Mr. Subhash Ghai Executive Chairman (1.85%)
Mr. Rahul Puri Managing Director 3.11%
Mr. Parvez A. Farooqui Executive Director 3.45%
*Mr. Prabuddha Dasgupta Chief Financial Officer Not Applicable
Mr. Ravi Poplai Company Secretary 5.63%
* Mr. Prabuddha Dasgupta joined the Company w.e.f. 07/07/2014
c. The percentage increase in the median remuneration of employees in
the financial year: -35.41%
d. The number of permanent employees on the rolls of Company: 319
e. The explanation on the relationship between average increase in
remuneration and Company performance:
Median remuneration has fallen during the year mainly owing to
appointment of employees with salary below median salary paid during
the financial year 2013-14. Number of employees grew from 267 in March,
2014 to 319 in March, 2015. Appointments were made for new Cinema
locations opened during the period.
f. Comparison of the remuneration of the key managerial personnel
against the performance of the Company:
Name Designation CTC (Rs.)
Mr. Subhash Ghai Executive Chairman 4,062,150
Mr. Rahul Puri Managing Director 2,814,574
Mr. Parvez A. Farooqui Executive Director 2,784,540
*Mr. Prabuddha Dasgupta Chief Financial Officer 2,201,613
Mr. Ravi Poplai Company Secretary 367,600
Name % Increase in PAT % Increase
CTC (Rs. in Lakhs) in PAT
Mr. Subhash Ghai (1.85%) 969.09 Not Ap-
Mr. Rahul Puri 3.11% Plicable
Mr. Parvez A. Farooqui 3.45%
*Mr. Prabuddha Dasgupta Not Applicable
Mr. Ravi Poplai 5.63%
* Mr. Prabuddha Dasgupta joined the Company w.e.f. 07/07/2014
g. Variations in the market capitalisation of the company, price
earnings ratio as at the closing date of the current financial year and
previous financial year and percentage increase or decrease in the
market quotations of the shares of the company in comparison to the
rate at which the company came out with the last public offer:
Date Paid up Closing EPS
Capital Market
Price per
shares
31.03.2014 112,906,000 *37.05 (1.25)
31.03.2015 112,906,000 *29.70 (3.01)
Increase/Decrease NIL (2.75) (1.76)
% Increase/Decrease NIL (8.55)% (1.41)%
No issue of shares
during the year -- -- --
Date PE Ratio Market
Capitalisation
(Rs. in Lakhs)
31.03.2014 (29.64) 8366.33
31.03.2015 (9.87) 6706.62
Increase/Decrease 19.77 (1659.71)
% Increase/Decrease (9.87)% 19.84%
No issue of shares
during the year -- --
*Market Price data as per NSE is considered.
h. Average percentage increase already made in the salaries of
employees other than the managerial personnel in the last financial
year and its comparison with the percentile increase in the managerial
remuneration and justification thereof and point out if there are any
exceptional circumstances for increase in the managerial remuneration:
Average percentage increase made in the salaries of Employees other
than the managerial personnel in the financial year was 7.71% whereas
the increase in the managerial remuneration was 2.59%.
i. The key parameters for any variable component of remuneration
availed by the directors:
Not Applicable.
j. The ratio of the remuneration of the highest paid director to that
of the employees who are not directors but receive remuneration in
excess of the highest paid director during the year:
Not Applicable.
k. Affirmation that the remuneration is as per the remuneration policy
of the Company:
The Company affirms remuneration is as per the remuneration policy of
the Company.
iii) Information as per Rule 5(2) of Chapter XIII, Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014:
(a) & (b) There were no employees drawing remuneration of Rs. 60 lacs
or more per annum, employed throughout the financial year and drawing
Rs. 5 lacs or more per month if employed for part of the financial year
during the financial year under review.
(c) there is no employee holding by himself or along with his spouse
and dependent children, 2% or more of the Equity shares of the Company
and drawing the aggregate remuneration in excess of that drawn by the
Managing Director or Whole-Time Director or Manager.
6. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchanges in India, is presented in a separate section forming part of
the Annual Report.
7. VIGIL MECHANISM/ WHISTLE BLOWER POLICY
The Vigil Mechanism of the Company, which also incorporates a whistle
blower policy in terms of the Listing Agreement to report genuine
concerns or grievances. The Vigil Mechanism/ Whistle Blower Policy may
be accessed on the Company's website
http://muktaarts.com/investor-relations/
8. RISK MANAGEMENT
Your Company is well aware of risks associated with its business. The
Company manages risk through a detailed Risk Management Policy
framework which lays down guidelines in identifying, assessing and
managing risks that the businesses are exposed to. Risk is managed by
the Board/Risk Management Committee of the Board through appropriate
structures that are in place at the Company.
9. HEALTH, SAFETY AND ENVIRONMENT
As a responsible corporate citizen, your Company lays considerable
emphasis on health, safety aspects of its human capital, operations and
overall working conditions. Thus being constantly aware of its
obligation towards maintaining and improving the environment, all
possible steps are being taken to meet the toughest environmental
standards on pollution, effluents, etc. across various spheres of its
business activities.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The Company is not engaged in manufacturing activities and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offices, etc. In particular the Company has taken specific
measures to ensure conservation of energy in places where Mukta A2
Cinemas are located.
Particulars regarding Foreign Exchange earnings and outgo required
under the provisions of Section 134(3) (m) of the Companies Act, 2013
read with Rule 8 of the Companies (Accounts) Rules, 2014 are given in
the notes forming part of accounts which forms part of the Annual
Report.
11. GREEN INITIATIVE
Section 136 of the Act and the Rules framed there under allows the
Company to send its Financial Statements by electronic mode to such
Members whose shareholding is in dematerialized format and whose email
addresses are registered with the Depositories for communication
purposes. As a responsible corporate citizen, the Company proposes to
effect electronic delivery of the Annual Report of the Company in lieu
of the paper form to the Members who have registered their email IDs
with the Depositories. A physical copy of the Annual Report will be
sent to those Members who have not registered their email addresses
with the Depositories for receiving electronic communication. A
physical copy of this Annual Report can also be obtained free of cost
by any Member from the Registered Office of the Company on any working
day during business hours.
A copy of this Annual Report is also available on the website of the
Company at www.muktaarts.com.
12. STATUTORY INFORMATION
The Business Responsibility Reporting as required by Clause 55 of the
Listing Agreement with the Stock Exchanges is not applicable to your
Company for the financial year ended March 31,2015.
13. ACKNOWLEDGEMENTS
Your Directors express their deep sense of gratitude to the Artistes,
Technicians, film distributors, exhibitors, Bankers, stakeholders and
business associates for their co-operation and support and look forward
to their continued support in future.
Your Directors also place on record, their appreciation for the
contribution, commitment and dedication to your Company's performance
by the employees of the Company at all levels.
For and on behalf of the Board of Directors of
Mukta Arts Limited
Subhash Ghai
Place: Mumbai Executive Chairman
Date: 29th May, 2015 DIN: 00019803
Mar 31, 2014
Dear Members,
The Directors take pleasure in presenting the Thirty Second Annual
Report and Audited Statement of Accounts of the Company for the
Accounting year ended 31st March, 2014:
Financial Results:
(Figures in millions)
Particulars Year ending Year ending
31.03.2014 31.03.2013
(RsJ. (Rs.)
Profit/(Loss) before 85.28 124.94
interest, depreciation & tax
Less: Interest 61.88 50.31
Profit/(Loss) after 23.4 74.63
interest, before depreciation & tax
Less: Depreciation 42.06 34.8
Profit/(Loss) before tax (18.66) 39.83
Less: Provision for taxation 0 6.3
Deferred Tax Liability/(Asset) 3.45 4.5
Profit/(Loss) available (15.21) 29.03
for appropriation
Less: Interim / Final Dividend 0 11.29
Tax on Interim / Final Dividend 0 1.92
Profit/(Loss) for the year (15.21) 15.82
Add: Balance brought forward 37.69 22.6
Less: Transfer to general reserve 0 0.73
Profit/(Loss) Carried forward 22.48 37.69
to Balance Sheet
Company''s Performance:
During the year the total revenues of the Company were placed at Rs.
2960.91 Millions compared to Rs. 2626.29 Millions last year.
The High Court of Judicature at Bombay (''High Court'') as per order
dated 09.02.2012 had quashed the Joint Venture Agreement (''JVA'')
between the Company and Maharashtra Film, Stage and Cultural
Development Corporation Limited (''MFSCDCL'') and passed consequential
orders. Special leave petition of the subsidiary Company viz. Whistling
Woods International Limited (''WWIL'') filed with the Supreme Court of
India in appeal did not succeed. The Company and WWIL had filed
applications to review the said order with the High Court in Mumbai and
after detailed hearing the Review Petition was admitted and a stay was
granted on 30th July 2014. However, as an interim arrangement the High
Court has ordered WWIL to pay arrears of rent for the years 2000-01 to
2013-14 aggregating to Rs 100,038,000 by January 2015 and pay rent of
Rs. 4,500,000 per annum from the financial year 2014-15, pending
disposal of the review petition.
The Company''s performance has been discussed in detail in the
Management Discussion and Analysis.
Share Capital:
The Share Capital remained the same during the year under review.
Dividend:
In view of the loss incurred by the Company in the year under review,
Your directors regret that they have not recommended any dividend on
equity shares for the year ended on 31st March, 2014.
Directors'' Responsibility Statement [Section 217 (2AA)]:
The Directors confirm that:
in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures; the Directors had selected such accounting
policies and applied them consistently and made judgments and estimates
that are reasonable and prudent so as to give true and fair view of the
state of affairs of the Company at the end of the financial year and of
the loss of the Company for the year;
the Directors had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other irregularities;
the Directors had prepared the annual accounts on a going concern
basis;
Directors:
Mr. Subhash Ghai has relinquished the position of Managing Director as
at the end of 29th May, 2014. Considering the experience and
contribution made by Mr. Subhash Ghai for the growth of the Company,
the Board of Directors at their meeting held on 29th May, 2014, upon
the recommendation of the Nomination and Remuneration Committee,
appointed Mr. Subhash Ghai as the Executive Chairman of the Company
with effect from 30th May, 2014.
Mr. Rahul Puri, has been elevated as the Managing Director of the
Company with effect from 30th May, 2014. Mr. Rahul Puri, Managing
Director, retires by rotation at the ensuing Annual General Meeting and
being eligible offers himself for re-appointment.
Mr. Vijay Choraria and Mr. Pradeep Guha have resigned from directorship
of the Company vide their resignation letters dated 24th December, 2013
and 14th June, 2014 respectively. The Board places on record its
appreciation for the services rendered Mr. Vijay Choraria and Mr.
Pradeep Guha during their tenure as Directors of the Company.
In accordance with the provisions of Section 149 of the Companies Act,
2013, members'' approval is being sought for appointment of Mr. Anil
Harish as Independent Director 5(five) consecutive years form 27th
September, 2014 to 26th September, 2019.
Mr. Kewal Handa has been appointed as Additional Director of the
Company. He was inducted on the Board of Directors with effect from 7th
June, 2014 as an Independent Director. As per the provisions of the
Companies Act, 2013, Independent Directors are required to be appointed
for a term of five consecutive years and shall not be liable to retire
by rotation. Accordingly, resolutions proposing appointment of
Independent Directors form part of the Notice of the Annual General
Meeting.
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet with the criteria of
Independence as prescribed both under Sub-Section (6) of Section 149 of
the Companies Act, 2013 and under Clause 49 of the Listing Agreement
with the Stock Exchanges.
Chief Financial Officer:
Your Company has appointed Mr. Prabuddha Dasgupta as Chief Financial
Officer (CFO) of the Company with effect from 7th July, 2014.
Auditors:
The Auditors of the Company M/s. B S R & Co. Chartered Accountant (ICAI
Firm Registration No- 101248W) has been converted into Limited
Liability Partnership with the name M/s. B S R & Co. LLP with effect
from 14th October, 2013.
The Auditors of the Company M/s B S R & Co. LLP, Chartered Accountants,
retire at the ensuing Annual General Meeting and being eligible offer
themselves for re-appointment as the Auditors of the Company. The
Company has received a written consent and a certificate from the
Auditors to the effect that their re-appointment, if made would be in
accordance with the provisions of the Companies Act, 2013 and that they
are not disqualified for such re-appointment.
The Company''s explanation to the Auditors'' observation in their Report
have been detailed in Note No.s 3.39 and 3.40 in the notes forming part
of accounts which forms part of the Annual Report.
Subsidiary Companies:
Mukta V N Films Limited has become a subsidiary of the Company since
its incorporation on June, 2013. Now, the Company has five subsidiaries
namely, Whistling Woods International Limited, Connect. 1 Limited,
Mukta Tele Media Limited, Coruscant Tec Private Limited and Mukta V N
Films Limited.
A Statement of Subsidiary Companies as prescribed under Section 212 of
the Companies Act, 1956, is annexed and is forming part of the Annual
Report.
The Ministry of Corporate Affairs, vide General Circular No. 2/2011
(No. 5/12/2007-CL-lll) dated 8th February 2011 has granted general
exemption to the Companies from attaching requisite documents of
subsidiary companies with Annual Report provided such Holding Companies
publish the Audited Consolidated Financial Statements in the Annual
Report. Accordingly, the Board has decided to avail the said general
exemption from applicability of provisions of Section 212 of the
Companies Act, 1956.
Further, pursuant to the aforesaid General Circular, your Company
undertakes that the annual accounts of its subsidiary companies and the
related detailed information shall be made available to the
shareholders and shareholders of subsidiary companies seeking such
information. The annual accounts of the subsidiary companies shall also
be kept for inspection by the shareholders in the head
office/registered office of your Company and of the subsidiary
companies concerned.
Following information in aggregate for each subsidiary are also
disclosed in one page after the consolidated accounts: (a) capital (b)
reserves (c) total assets (d) total liabilities (e) details of
investment (except in case of investment in the subsidiaries) (f)
turnover (g) profit before taxation (h) provision for taxation (i)
profit after taxation (j) proposed dividend.
Corporate Governance:
The Company has been proactive in following the principles and
practices of good Corporate Governance. The Company has taken adequate
steps to ensure that the conditions of Corporate Governance as
stipulated in clause 49 of the Listing Agreements of the Stock
Exchanges are complied with.
The Practicing Company Secretary has certified the Company''s Compliance
of the requirements of Corporate Governance in terms of Clause 49 of
the Listing Agreement and the same is enclosed as an Annexure to the
Report on Corporate Governance.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo:
The Company is not engaged in manufacturing activities, and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offices, etc. In particular the Company has taken specific
measures to ensure conservation of energy in places where Mukta A2
Cinemas are located.
Particulars regarding Foreign Exchange earnings and outgo required
under Section 217 (1) (e) of the Companies Act, 1956 and Companies
(Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 are given in Note No.s 3.37 and 3.38 in the notes forming
part of accounts which forms part of the Annual Report.
Insurance:
The properties and insurable interests of your Company like buildings,
plant and machinery, stocks among others are adequately insured.
Fixed Deposits:
The Company has not accepted any deposits during the year and as such
no amount of principal or interest was outstanding at the Balance Sheet
date.
Listing of Company''s Securities
The Company is listed in the BSE Ltd. (formerly known as Bombay Stock
Exchange Ltd.), National Stock Exchange of India Limited (NSE) and The
Calcutta Stock Exchange Association Limited (CSE).
The Company has applied for voluntary delisting from the Calcutta Stock
Exchange Association Limited (CSE) w.e.f. 31st March, 2014. The
Company has passed a board resolution for voluntary delisting from CSE
at its Board Meeting dated 6th February, 2014 and published public
notice of the proposed delisting in English, Hindi and Bengali
newspapers on 25th March, 2014.
The Equity Shares of the Company will continue to be listed on the BSE
and NSE. Post delisting, there would be no change in the capital
structure of the Company.
The Listing fees for the year 2014-15 have already been paid to all the
Stock Exchanges where the Company''s shares are listed except the
Calcutta Stock Exchange Association Limited.
Particulars of Employees:
Particulars of Employees as required under Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Amendment Rules, 2011 are not being furnished as there was no employee
drawing remuneration over the limits specified under the said Section
and the Rules specified thereunder.
Social Commitments:
Your Company is aware of its social responsibility and has been from
time to time contributing to social causes.
Human Resources:
Human Resource is considered as one of the most critical resources in
the business which can be continuously smoothened to maximize the
effectiveness of the Organization. Human Resources build the Enterprise
and the sense of belonging would inculcate the spirit of dedication and
loyalty amongst them towards strengthening the Company''s Polices and
Systems. All personnel continue to have healthy, cordial and
harmonious approach thereby enhancing the contributory value of the
Company.
Safety and Health:
The health and safety of the employees across its operations remains
the highest priority for the Company. All endeavors are being taken to
enhance safety standards and processes towards minimising safety risks
in all operations in the company.
Acknowledgements:
Your Directors express their deep sense of gratitude to the Artistes,
Technicians, film distributors, exhibitors, Bankers, stakeholders and
business associates for their co-operation and support and look forward
to their continued support in future.
Your Directors also place on record, their appreciation for the
contribution, commitment and dedication to your Company''s performance
by the employees of the Company at all levels.
On Behalf of the Board of Directors
Subhash Ghai
Place: Mumbai Chairman
Date: 8th August, 2014
Mar 31, 2013
To the Members,
The Directors take pleasure in presenting the Thirty First Annual
Report and Audited Statement of Accounts of the Company for the
Accounting year ended 31st March, 2013:
Financial Results:
(Figures in millions)
Particulars year ending Year ending
31.03.2013 31.03.2012
(Rs.) (Rs.)
Proft/(Loss) before interest,
depreciation & tax 124.94 399.78
Less : Interest 50.31 50.44
Proft/(Loss) after interest,
before depreciation & tax 74.63 349.34
Less : Depreciation 34.8 32.91
Proft/(Loss) before tax 39.83 316.43
Less : Provision for taxation 6.3 54.43
Deferred Tax Liability/(Asset) 4.5 6.28
Proft/(Loss) available for appropriation 29.03 255.72
Less : Interim / Final Dividend 11.29 22.58
Tax on Interim / Final Dividend 1.92 3.66
Proft/(Loss) for the year 15.82 229.48
Add : Balance brought forward 22.6 (187.7)
Less : Transfer to general reserve 0.73 19.18
Proft/(Loss) Carried forward to
Balance Sheet 37.69 22.6
Company''s Performance:
During the year the total revenues of the Company were placed at Rs.
2626.29 Millions compared to Rs. 2391.32 Millions last year.
The Company''s performance has been discussed in detail in the
Management Discussion and Analysis.
Share Capital:
The Share Capital remained the same during the year under review.
Dividend:
Based on the Company''s performance, the Directors are pleased to
recommend for approval of the members a dividend at the rate of 10%
(Rs. 0.50 per share of Rs 5/- each) for the year ended 31st March,
2013.
Directors'' Responsibility statement [section 217 (2AA)]:
The Directors confrm that: in the preparation of the annual accounts,
the applicable accounting standards have been followed along with
proper explanation relating to material departures;
the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the fnancial year and of the proft of the Company
for the year;
the Directors had taken proper and suffcient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other irregularities;
the Directors had prepared the annual accounts on a going concern
basis;
Directors:
Mr. Vijay Choraria and Mr. Anil Harish, Directors, retire by rotation
at the ensuing Annual General Meeting and being eligible offer
themselves for reappointment.
Auditors:
M/s B S R & Co., Chartered Accountants, retire at the ensuing Annual
General Meeting and being eligible offer themselves for reappointment
as the Auditors of the Company.
The Company''s explanation to the Auditors'' observation in their Report
have been detailed in Note No.s 3.39 and 3.40 in the notes forming part
of accounts which forms part of the Annual Report.
Resolution passed by Postal Ballot:
The Board of Directors of your Company sought and obtained during the
year, approval of shareholders by Postal Ballot pursuant to the
provision of Section 192A of the Companies Act, 1956, read with the
Companies (Passing of the Resolution by Postal Ballot) Rules, 2011,
authorizing the Board of Directors to form a Subsidiary Company under
the name of Mukta VN Films Limited or any other suitable name that may
be available with the Registrar of Companies to be registered in the
State of Maharashtra and to allow the said Company to conduct the
business of flm exhibition and programming being currently conducted by
the Company itself and to enter into a Shareholders Agreement with
V.N.Films Private Limited, by way of Ordinary Resolution passed with
overwhelming majority.
Accordingly, the Ordinary Resolution as set out in the Postal Ballot
Notice dated 5th March, 2013 has been taken on record by the Company.
Film exhibition and Programming Business:
The Company has located an opportunity for alliance to enhance the
turnover of flm exhibition and programming business substantially by
joining hands with another company viz. V.N.Films Private Limited
(formerly known as Allied Services Private Limited), a subsidiary of
UFO Moviez India Limited which is also a signifcant player in flm
exhibition and programming. It is proposed that V.N.Films Private
Limited will pool their exhibition and programming business in addition
to subscribing to agreed number of shares in the new company. This
proposal was duly approved by the members vide postal ballot in April,
2013.
Subsidiary Companies:
The Company is having four subsidiaries namely, Whistling Woods
International Limited, Connect.1 Limited, Mukta Tele Media Limited and
Coruscant Tec Private Limited.
The Ministry of Corporate Affairs, vide General Circular No. 2/2011
(No. 5/12/2007-CL-III) dated 8th February 2011 has granted general
exemption to the Companies from attaching requisite documents of
subsidy companies with Annual Report provided such Holding Companies
publish the Audited Consolidated Financial Statements in the Annual
Report. Accordingly, the Board has decided to avail the said general
exemption from applicability of provisions of Section 212 of the
Companies Act, 1956.
Further, pursuant to the aforesaid General Circular, your Company
undertakes that the annual accounts of its subsidiary companies and the
related detailed information shall be made available to the
shareholders and shareholders of subsidiary companies seeking such
information. The annual accounts of the subsidiary companies shall also
be kept for inspection by the shareholders in the head offce/registered
offce of your Company and of the subsidiary companies concerned.
Following information in aggregate for each subsidiary are also
disclosed in one page after the consolidated accounts: (a) capital (b)
reserves (c) total assets (d) total liabilities (e) details of
investment (except in case of investment in the subsidiaries) (f)
turnover (g) proft before taxation (h) provision for taxation (i) proft
after taxation (j) proposed dividend.
Corporate Governance:
The Company has been proactive in following the principles and
practices of good Corporate Governance. The Company has taken adequate
steps to ensure that the conditions of Corporate Governance as
stipulated in clause 49 of the Listing Agreements of the Stock
Exchanges are complied with.
The Practicing Company Secretary has certifed the Company''s Compliance
of the requirements of Corporate Governance in terms of Clause 49 of
the Listing Agreement and the same is enclosed as an Annexure to the
Report on Corporate Governance.
Conservation of energy, technology Absorption, Foreign exchange
earnings and outgo:
The Company is not engaged in manufacturing activities, and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offces, etc.
Particulars regarding Foreign Exchange earnings and outgo required
under Section 217 (1) (e) of the Companies Act, 1956 and Companies
(Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 are given in Note No.s 3.37 and 3.38 in the notes forming
part of accounts which forms part of the Annual Report.
Insurance:
The properties and insurable interests of your Company like buildings,
plant and machinery, stocks among others are adequately insured.
Fixed Deposits:
The Company has not accepted any deposits during the year and as such
no amount of principal or interest was outstanding at the Balance Sheet
date.
Particulars of employees:
Particulars of Employees as required under Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Amendment Rules, 2011 are not being furnished as there was no employee
drawing remuneration over the limits specifed under the said Section
and the Rules specifed thereunder.
Social Commitments:
Your Company is aware of its social responsibility and has been from
time to time contributing to social causes.
Acknowledgements:
Your Directors express their deep sense of gratitude to the Artistes,
Technicians, flm distributors, exhibitors, Bankers, stakeholders and
business associates for their co-operation and support and look forward
to their continued support in future.
Your Directors also place on record, their appreciation for the
contribution, commitment and dedication to your Company''s performance
by the employees of the Company at all levels.
on Behalf of the Board of Directors
Place: Mumbai Subhash Ghai
Date: 28 May, 2013 Chairman & Managing Director
Mar 31, 2012
The Directors take pleasure in presenting the Thirtieth Annual Report
and Audited Statement of Accounts of the Company for the Accounting
year ended 31st March, 2012:
Financial Results:
(Figures in millions)
Particulars Year ending Year ending
31.03.2012 31.03.2011
(Rs.) (Rs.)
Profit/(Loss) before interest,
depreciation & tax 399.78 30.29
Less: Interest 50.44 60.56
Profit/(Loss) after interest, before
depreciation & tax 349.34 (30.27)
Less: Depreciation 32.91 29.65
Profit/(Loss) before tax 316.43 (59.92)
Less: Provision for taxation 54.43 11.21
Deferred Tax Liability/(Asset) 6.28 (9.50)
Profit/(Loss) available for appropriation 255.72 (61.63)
Less: Interim Dividend 22.58 -
Tax on Interim Dividend 3.66 -
Profit/(Loss) for the year 229.48 (61.63)
Add: Balance brought forward (187.70) (126.07)
Less: Transfer to general reserve 19.18 -
Profit/(Loss) Carried forward to Balance Sheet 22.60 (187.70)
Company's Performance
During the year the total revenues of the Company were placed at Rs.
2391.32 Millions Compared to Rs. 2052.44 Millions last year.
The High Court of Judicature at Bombay ('High Court') has quashed the
Joint Venture Agreement ('JVA') relating to the wholly-owned
subsidiary of the Company viz. Whistling Woods International Limited
(WWIL) between the Company and Maharashtra Film, Stage and Cultural
Development Corporation Limited ('MFSCDCL') vide its order of 9th
February 2012.
Pursuant to the said Order of the High Court, the allotment of land to
WWIL has been cancelled and WWIL has been ordered to return 14.5 acres
out of total land admeasuring 20 acres of land to MFSCDCL. WWIL filed
an appeal with the Supreme Court of India which has been dismissed. The
Company and WWIL have filed applications to review the said order with
the High Court, which have not yet come up for hearing.
The Company's performance has been discussed in detail in the
Management Analysis.
Share Capital
The Share Capital remained the same during the year under review.
Directors' Responsibility Statement [Section 217 (2AA)]
The Directors confirm that:
in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper expla- nation relating
to material departures;
the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the financial year and of the profit of the
Company for the year;
the Directors had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other ir- regularities;
the Directors had prepared the annual accounts on a going concern
basis;
Directors
Mr. Rahul Puri and Mr. Pradeep Guha, Directors, retire by rotation at
the ensuing Annual General Meeting and being eligible offer themselves
for reappointment.
Auditors:
M/s B S R & Co. Chartered Accountants retire at the ensuing Annual
General Meeting and being eligible offer themselves for reappointment
as the Auditors of the Company.
The Company's explanation to the Auditors' observation in their Report
have been detailed in Note No 3.35 in the notes forming part of
accounts which forms part of the Annual Report.
Subsidiary Companies
The Company is having four subsidiaries namely, Whistling Woods
International Limited, Connect.1 Limited, Mukta Tele Media Limited and
Coruscant Tec Private Limited.
The provisions of Section 212 of the Companies Act, 1956 provides for
the attachment of annual accounts and other requisite documents of all
the subsidiary companies with the Balance Sheet of the holding company
to be sent to all the shareholders of the holding company. However,
Section 212(8) of the Companies Act, 1956 provides for an exception to
the aforesaid requirement by way of allowing the Holding company to
make an application to the Central Government for exemption from
attaching the said documents with the Balance Sheet of the Holding
company.
However, the Ministry of Corporate Affairs, vide General Circular No.
2/2011 (No. 5/12/2007-CL-III) dated 8th February 2011 came out with a
direction that henceforth the requirement of seeking Central
Government's exemption from attaching the balance sheet/s of the
subsidiaries shall not apply to a company provided the following
conditions as stipulated in the aforesaid General Circular are complied
with:
1. The Board of Directors of the Company has by resolution given
consent for not attaching the balance sheet of the subsidiary
concerned;
2. The company shall present in the annual report, the consolidated
financial statements of holding company and all subsidiaries duly
audited by its statutory auditors;
3. The consolidated financial statement shall be prepared in strict
compliance with applicable Accounting Standards and, where applicable,
Listing Agreement as prescribed by the Securities and Exchange Board of
India;
4. The company shall disclose in the consolidated balance sheet the
following information in aggregate for each subsidiary including
subsidiaries of subsidiaries:- (a)capital (b) reserves (c) total assets
(d) total liabilities(e) details of investment (except in case of
investment in the subsidiaries) (f) turnover (g) profit before taxation
(h) provision for taxation (i) profit after taxation (j) proposed
dividend;
5. The holding company shall undertake in its annual report that
annual accounts of the subsidiary companies and the related detailed
information shall be made available to shareholders of the holding and
subsidiary companies seeking such information at any point of time. The
annual accounts of the subsidiary companies shall also be kept for
inspection by any shareholders in the head office of the holding
company and of the subsidiary companies concerned and a note to the
above effect will be included in the annual report of the holding
company. The holding company shall furnish a hard copy of details of
accounts of subsidiaries to any shareholder on demand;
6. The holding as well as subsidiary companies in question shall
regularly file such data to the various regulatory and Government
authorities as may be required by them;
7. The company shall give Indian rupee equivalent of the figures given
in foreign currency appearing in the accounts of the subsidiaries
companies along with exchange rate as on closing day of the financial
year.
Accordingly, the Board, in its meeting held on 29th May, 2012 granted
its consent as aforesaid.
Further, pursuant to the aforesaid General Circular, your Company
undertakes that the annual accounts of its subsidiary companies and the
related detailed information shall be made available to our
shareholders and shareholders of subsidiary companies seeking such
information at any point of time. The annual accounts of the subsidiary
companies shall also be kept for inspection by any shareholders in the
head office/registered office of your Company and of the subsidiary
companies concerned. The holding company shall furnish a hard copy of
details of accounts of subsidiaries to any shareholder on demand.
Following information in aggregate for each subsidiary are also
disclosed in one page after the consolidated accounts:
(a) capital (b) reserves (c) total assets (d) total liabilities (e)
details of investment (except in case of investment in the
subsidiaries) (f) turnover (g) profit before taxation (h) provision for
taxation (i) profit after taxation (j) proposed dividend.
Further, the details of the accounts of individual subsidiary companies
are also put on your Company's website www. muktaarts.com
Corporate Governance
The Company has been proactive in following the principles and
practices of good Corporate Governance. The Company has taken adequate
steps to ensure that the conditions of Corporate Governance as
stipulated in clause 49 of the Listing Agreements of the Stock
Exchanges are complied with.
The Practicing Company Secretary has certified the Company's Compliance
of the requirements of Corporate Governance in terms of Clause 49 of
the Listing Agreement and the same is enclosed as an Annexure to the
Report on Corporate Governance.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo
The Company is not engaged in manufacturing activities, and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offices, etc.
Particulars regarding Foreign Exchange earnings and outgo required
under Section 217 (1) (e) of the Companies Act, 1956 and Companies
(Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 are given in note no.s 3.38 and 3.39 in the notes forming
part of accounts which forms part of the Annual Report.
Fixed Deposits
The Company has not accepted any deposits during the year and as such
no amount of principal or interest was outstanding at the Balance Sheet
date.
particulars of Employees
Particulars of Employees as required under Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Amendment Rules, 2011 drawing remuneration over the limits specified in
the amendment rules vide GSR 289(E) dated 31.03.2011 issued by the
Ministry of Corporate Affairs, New Delhi, are contained in the Annexure
annexed to the Report.
Social Commitments
Your Company is aware of its social responsibility and has been from
time to time contributing to social causes. Acknowledgements
The Board of Directors wishes to thank and record its appreciation to
the Artistes, Technicians, film distributors, Bankers, Media and
shareholders who have extended their continued support to the Company.
Your Directors thank especially all employees of the Company for their
dedicated services to the Company.
On Behalf of the Board of Directors
Place : Mumbai Subhash Ghai
Date : 29 May 2012 Chairman & Managing Director
Mar 31, 2011
To the Members,
The Directors take pleasure in presenting the Twenty-Ninth Annual
Report and Audited Statement of Accounts of the Company for the
Accounting year ended 31st March, 2011:
Financial Results:
(Figures in millions)
Particulars Year ending Year ending
31.03.2011 31.03.2010
(Rs.) (Rs.)
Profit/(Loss) before
interest, depreciation & tax 30.29 (172.42)
Less : Interest 60.56 51.11
Profit/(Loss) after interest,
before depreciation & tax (30.27) (223.53)
Less : Depreciation 29.65 18.65
Profit/(Loss) before tax (59.92) (242.18)
Less : Provision for taxation 11.21 -
Deferred Tax Liability/(Asset) (9.50) 0.26
Profit/(Loss) available for
appropriation (61.63) (242.44)
Less : Interim Dividend
Tax on Interim Dividend
Profit/(Loss) for the year (61.63) (242.44)
Add: Balance brought forward (126.07) 116.37
Profit/(Loss) Carried forward
to Balance Sheet (187.70) (126.07)
Company's Performance:
During the year the total revenues of the Company were placed at Rs.
2052.44 Millions Compared to Rs. 942.17 Millions last year.
The Company's performance has been discussed in the Management Analysis
in details.
Share Capital:
The Share Capital remained the same during the year under review.
Directors:
Mr. Vijay Choraria and Mr. Anil Harish Directors, retire by rotation at
the ensuing Annual General Meeting and being eligible offer themselves
for reappointment.
Auditor's Report and Certifi cate:
The Company's explanation to the Auditors' observation in their Report
have been detailed in Note Nos 22.1 to 22.3 in the notes forming part
of Accounts which forms part of the Annual Report. The Practising
Company Secretary has certifi ed the Company's Compliance of the
requirements of Corporate Governance in terms of Clause 49 of the
Listing Agreement and the same is enclosed as an Annexure to the Report
on Corporate Governance.
Directors' Responsibility Statement [Section 217 (2AA)]:
The Directors confirm that: in the preparation of the annual accounts,
the applicable accounting standards have been followed along with
proper explanation relating to material departures;
the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the financial year and of the loss of the
company for the year;
the Directors had taken proper and suffi cient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other irregularities; the Directors had
prepared the annual accounts on a going concern basis;
Auditors:
M/s B S R & Co. Chartered Accountants retire at the ensuing Annual
General Meeting and being eligible offer themselves for reappointment
as the Auditors of the Company.
Statutory Disclosures:
The Statements relating to the subsidiary companies viz. Whistling
Woods International Limited, Connect 1 Limited (Previously Mukta Arts
International Limited), Mukta Tele Media. Ltd. and Coruscant Tec
Private Limited pursuant to Section 212 of the Companies Act, 1956 are
attached to the Accounts.
No employee of the Company was in receipt of remuneration as per the
limit for the financial year 2010-2011 under section 217 (2A)
Particulars regarding Foreign Exchange earnings and outgo required
under Section 217 (1) (e) of the Companies Act, 1956 and Companies
(Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 are given in Schedule 22.6 and 22.7 (Statement of Signifi
cant Accounting Policies and Notes forming Part of Accounts) of this
report.
A cash fl ow statement for the year ended 31.03.2011 is included with
the Accounts.
Corporate Governance:
The Company has been proactive in following the principles and
practices of good Corporate Governance. The company has taken adequate
steps to ensure that the conditions of Corporate Governance as
stipulated in clause 49 of the Listing Agreements of the Stock
Exchanges are complied with.
A separate statement on corporate governance is produced as a part of
the Annual Report along with the Practicing Company Secretaries certifi
cate on its compliance.
Conservation of Energy and Technology Absorption:
The Company is not engaged in manufacturing activities, and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offices, etc.
Fixed Deposits:
The Company has not accepted any deposits during the year and as such
no amount of principal or interest was outstanding at the Balance Sheet
date.
Social Commitments:
Your Company is aware of its social responsibility and has been from
time to time contributing to social causes.
Acknowledgements:
The Board of Directors wishes to thank and record its appreciation to
the Artistes, Technicians, film distributors, Bankers, Media and
shareholders who have extended their continued support to the Company.
Your Directors thank especially all employees of the Company for their
dedicated services to the Company.
On Behalf of the Board of Directors
Place : Mumbai Subhash Ghai
Date : 27th May, 2011 Chairman & Managing Director
Mar 31, 2010
The Directors take pleasure in presenting the Twenty-Eighth Annual
Report and Audited Statement of Accounts of the Company for the
Accounting year ended 31st March, 2010:
Financial Results
(Figures in millions)
Particulars Year ending Year ending
31.03.2010 31.03.2009
(Rs.) (Rs.)
Proft/(Loss) before interest, depreciation
& tax (174.96) 89.27
Less: Interest 48.58 9.60
Proft/(Loss) after interest, before
depreciation & tax (223.54) 79.67
Less: Depreciation 18.65 18.89
Proft/(Loss) before tax (242.19) 60.78
Less: Provision for taxation - 19.00
Fringe Beneft Tax - 88
Deferred Tax Liability/(Asset) 0.25 (0.11)
Proft/(Loss) available for appropriation (242.44) 41.01
Less: Interim Dividend - 22.58
Tax on Interim Dividend - 3.84
Proft/(Loss) for the year (242.44) 14.59
Add: Balance brought forward 116.37 106.78
Proft/(Loss) Carried forward to Balance Sheet (126.07) 116.37
Company"s Performance
During the year the total revenues of the Company were placed at Rs.
942,175,412 as compared to Rs 1,677,501,284 of last year.
The Companys performance has been discussed in the Management Analysis
in details.
New Initiatives
Mukta Arts Ltd has acquired balance 49% shares of Coruscant Tec Private
Limited and as on date the company holds 100% shares of the said
company making it a fully owned subsidiary company.
Mukta Arts Limited has actively entered into exhibition business and
has tied up with malls at Bhopal, Ahmedabad, Baroda to develop,
maintain and run multiplexes at their properties. Discussion is also
going on for few more properties for developing and reviewing
multiplexes.
share Capital
The Share Capital remained the same during the year under review.
Directors
Mr. Pradeep Guha and Mr. Rahul Puri, Directors, retire by rotation at
the ensuing Annual General Meeting and being eligible offer themselves
for reappointment. The requisite particulars in respect of director
seeking re-appointment are given in Annexure I.
Auditors Report and Certifcate
The Companys explanation to the Auditors observation in their Report
have been detailed in Note Nos 2 (f) to 2 (g) in the notes forming part
of Accounts contained in Schedule ÃPÃ which forms part of the Annual
Report. The Practicing Company Secretary have certifed the Companys
Compliance of the requirements of Corporate Governance in terms of
Clause 49 of the Listing Agreement and the same is enclosed as an
Annexure to the Report on Corporate Governance.
Directors Responsibility statement [section 217 (2AA)]
* The Directors confrm that:in the preparation of the annual accounts,
the applicable accounting standards have been followed along with
proper explanation relating to material departures;
* the Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the fnancial year and of the loss of the company
for the year;
* the Directors had taken proper and suffcient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other irregularities;
* the Directors had prepared the annual accounts on a going concern
basis;
Auditors
M/s Shamit Majmudar Associates Chartered Accountants retire at the
ensuing Annual General Meeting. M/s Shamit Majmudar Associates have
however expressed their unwillingness to continue as Auditors for next
year. Hence the company has approached M/s BSR & Co, Chartered
Accountants who have given their consent to act as Statutory Auditors
of the Company. Shareholders are requested to appoint the Auditors by
passing appropriate resolution. The Directors appreciate the services
rendered by M/s Shamit Majmudar Associates since the inception of the
Company and thank them for their dedicated services.
statutory Disclosures
The Statements relating to the subsidiary companies viz. Whistling
Woods International Limited, Connect 1.Limited (Previously Mukta Arts
International Limited), Mukta Tele Media. Ltd., and Coruscant Tec
Private Limited pursuant to Section 212 of the Companies Act, 1956 are
attached to the Accounts.
Particulars of employees required under Section 217 (2A) of the
Companies Act, 1956 and the Companies (Particulars of Employees) Rules,
1975, as amended, are given in Annexure II.
Particulars regarding Foreign Exchange earnings and outgo required
under Section 217 (1) (e) of the Companies Act, 1956 and Companies
(Disclosure of Particulars in the report of the Board of Directors)
Rules, 1988 are given in Schedule P (Statement of Signifcant Accounting
Policies and Notes forming Part of Accounts) of this report.
A cash fow statement for the year ended 31.03.2010 is included with the
Accounts.
Corporate governance
The Company has been proactive in following the principles and
practices of good Corporate Governance. The company has taken adequate
steps to ensure that the conditions of Corporate Governance as
stipulated in clause 49 of the Listing Agreements of the Stock
Exchanges are complied with.
A separate statement on corporate governance is produced as a part of
the Annual Report along with the Practicing Company Secretaries
certifcate on its compliance.
Conservation of energy and technology Absorption
The Company is not engaged in manufacturing activities, and as such the
particulars relating to conservation of energy and technology
absorption are not applicable. The Company makes every effort to
conserve energy as far as possible in its post-production facilities,
Studios, Offces, etc.
Fixed Deposits
The Company has not accepted any deposits during the year and as such
no amount of principal or interest was outstanding at the Balance Sheet
date.
social Commitments
Your Company is aware of its social responsibility and has been from
time to time contributing to social causes.
Acknowledgements
The Board of Directors wishes to thank and record its appreciation to
the Artistes, Technicians, flm distributors, Bankers, Media and
shareholders who have extended their continued support to the Company.
Your Directors thank especially all employees of the Company for their
dedicated services to the Company.
on Behalf of the Board of Directors
Place: Mumbai Subhash Ghai
Date: 12th August, 2010 Chairman & Managing Director