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Directors Report of Mukta Arts Ltd.

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

 
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