P) Provisions and contingencies
A provision is recognised when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.
For the year ended 31st March, 2024 there are no contingencies.
3) Notes on Accounts
A) Inventories:
The Company holds work in progress of movie projects amounting to Rs 6,76,140.76 (PY: 4,21,257.53) at the end of the reporting period. Opening balance of work-in-progress includes the costs of the films sold during the current financial year, which have been recognised in the Statement of Profit and Loss.
B) Investments
The Company has invested in Unquoted Equity shares and unquoted compulsorily convertible preference shares of its subsidiary M/s Vels Studios and Entertainment Private Limited (Previously known as M/s Innovative Studio Private Limited) on various dates, the details of which are below:
During the period, the Company did not earn any income from the investment which needs to be recognised in the Statement of Profit and Loss. There are no significant restrictions on the right of ownership, realisability of investments or the remittance of income and proceeds of disposal.
C) Foreign Currency translations and transactions Earnings in Foreign Exchange:
I. Earnings from export of services by selling of theatrical, satellite and digital rights overseas:
b) The hypothecation of the Vehicle purchased with loan financed by Bank of Baroda of Rs 20 lakhs has been registered with the Transport Authority as per the Motor Vehicles Act. In view of the hypothecation endorsement of the Registration Certificate and the non-insistence of the bank, a charge on the Vehicle has not been created under the Companies Act, 2013.
L) Contingent Liabilities
i. Vels Film International Limited is a co-applicant for a loan obtained by its subsidiary, Vels Studios and Entertainment Private Limited. The details of the contingent liability are as follows:
The Subsidiary has obtained a secured loan of Rs. 15,00,00,000 from Hinduja Leyland Finance Limited. The Loan is repayable within a period of 120 months on a monthly installments basis from the month of January 2022, chargeable with a floating interest rate of 11.50% p.a (till Jan -23 - 11.00%) and is secured by plot No.24 & 26, KIADB Industrial Area, Bidadi-562109 of subsidiary.
As at 31 March 2024, Loan shows the outstanding balance of Rs.13.94 Crores.
ii. The Company filed a petition seeking relief of Rs 4.50 crores with interest at 24% per annum from a film artist in connection with a project in progress along with damages of Rs 10 crores for not performing his part of obligations before the Hon'ble Sole Arbitrator on 18th August 2023. The respondent filed a counter claim to dismiss the claim and to direct the Company to pay a claim amount of Rs 8.5 Crores towards compensatory damages.
The Company (claimant) withdrew the petition as per the order dated 8th April 2024 of the Hon'ble Tribunal. The respondent has also correspondingly withdrew the counter-petition. Hence, the case is dismissed on the date of approval of financial statements.
M) Previous year figures have been regrouped and amended wherever necessary.
As per our report of even date attached For S R B R & Associates LLP
Chartered Accountants For and on behalf of the Board of Directors
FRN: 004997S/S200051
-Sd- -Sd- -Sd- -Sd- -SdR. Sundararajan Ishari Ganesh Kadhirvelan Arthi Sampath Kumar Sujatha Rajagopal Srinivasan
PartnerManaging Director Director Director Company Secretary Chief Financial Officer
M.No. 029814 DIN :00269445 DIN : 00568101 A32181
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