Padmalaya Telefilms Ltd
Directors Reports
To
The Members PADMALAYA TELEFILMS LTD
Your directors have pleasure in presenting the 30th Annual Report on the business of
your company and the Audited Financial Statements for the year ended on 31st March 2021
thereof. The Business and operations of the company over the last fiscal year are briefly
encapsulated in this Annual Report.
Financial Results
Financial performance of the Company is elaborated in the Financial Statements annexed
to this Annual Report.
Effect of COVID -19
Impact of COVID-19, on the Indian film industry at large is still being evaluated,
production and related fields have suffered in India a lot. Due to the pandemic, big
releases postponed, film, TV and web series shootings halted, theatres unable to screen
movies, daily wage employees struggling for their next meal. The Indian film industry is
going through its worst phase because of the lockdown necessitated by the coronavirus
pandemic Covid-19's ripple effect was felt when film bodies including Federation of
Western Indian Cine Employees (FWICE) and Indian Film & Television Directors'
Association (IFTDA) decided to halt shooting of movies, TV shows and web series. Major
production houses like Balaji Motion Pictures, Dharma Productions and Yash Raj Films also
promptly called off all production activity. Amid this, various state governments ordered
the closing down of cinema halls, and these situations sealed the fate for several
projects.
The Company's proactive and compassionate response to the unprecedented challenges
posed by the COVID-19 pandemic is very much in keeping with its founding principles. Our
three-pronged approach to the pandemic includes ensuring the safety and well-being of our
employees, supporting the health care system with innovative products and solutions, and
supporting the underprivileged, who have been impacted the most by this crisis.
Business Performance Review
During the year under review, due to various external, marketing & industry factors
have affected the business, and the performance of the company is not as per the business
standards set-up by the management. The Board and its Management has made the postmortem
analysis on the lacuna in the performance and the Board of Directors assures you better
performance in the years to come.
Outlook for the current year
Your Company has reviewed all its business divisions and, the performance of the
Company is not as per the expectations inspite of continuous efforts to strengthen its
stand in the market.
Dividend
The Board could not recommend dividend during the year under review in absence of
profits.
BUSINESS RISK MANAGEMENT
The Company, like any other enterprise, is exposed to business risk which can be
internal risks as well as external risks. The threats to the industry in which the company
operates are -
Piracy: Piracy of the produced content, under the purview of intellectual property
rights, can adversely affect revenues and profitability.
Mitigation: Industry members have set up an Ant piracy Society (AACT) to fight the
menace.
DEPOSITS
The Company has not accepted deposits covered under Chapter V of the Companies Act,
2013 and accordingly, the disclosure requirements stipulated under the said Chapter are
not applicable.
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
During the year under review, the company has not given any loans, Guarantees and
Investments covered under the provisions of Section 186 of the Companies Act, 2013
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of
the Companies (Accounts) Rules, 2014, except the remuneration to managerial personnel,
there are no related party transactions to be disclosed.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 is annexed
herewith elsewhere in the Annual Report.
DEMAT SUSPENSE ACCOUNT UNCLAIMED SHARES
As on 31st March 2021, there were no Equity Shares of Shareholders were lying in the
Escrow Account due to non-availability of the correct particulars.
CORPORATE GOVERNANCE
Your directors are happy to report that your Company is compliant with the Corporate
Governance requirements as per the Provisions of SEBI (Listing Obligations and Disclosures
Requirements) Regulations. A separate section on Corporate Governance together with a
certificate from the Statutory Auditor's confirming compliance is set out in the Annexure
forming part of this report.
MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT
A Management Discussion and Analysis Report, has been attached and forms part of the
Annual Report.
ADDITIONAL INFORMATION AS REQUIRED U/ S 134(3)(m) OF THE COMPANIES ACT, 2013
(a) Conservation of Energy:
(i) details of steps taken by the company for utilising alternate sources of energy,
and
(ii) the capital investment on energy conservation equipments, are -
The company is not engaged in manufacturing activities, and as such the particulars
relating to conservation of energy is not applicable. The company makes every effort to
conserve energy as far as possible in its editing facilities, Production Floors, Office
etc.
(b) (i) Technology Absorption, adaptation and innovation:-
The company is not engaged in manufacturing activities, and as such the particulars
relating to Research, Development and technology absorption are not applicable.
(ii) Research and Development (R & D): No research and Development has been carried
out.
(c) Foreign exchange earnings: Nil
(d) Foreign exchange out go: Nil
PARTICULARS OF EMPLOYEES
The Directors are to report that none of the employee was in receipt of remuneration
exceeding the limit prescribed under rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules 2014
STATUTORY AUDITORS
The provisions of Section 139(2) of the Companies Act 2013 and the Rules made
there-under, mandated the Company to rotate its Statutory Auditors and Board of Directors
of the Company (on recommendation of Audit Committee) in its meeting held on 1st September
2017, has, (which was ratified by the shareholders in the Annual General meeting held on
29th September 2017), approved the appointment of M/s. P C N & Associates., (FRN:
016016S),Chartered Accountants, as the Statutory Auditors of the Company.
In this regard, the said Statutory Auditors has given the declaration that they meet
the criteria to act as the Statutory Auditor and they are not disqualified to continue as
the Statutory Auditors of the Company.
BOARD AND COMMITTEES PERFORMANCE EVALUATION
Pursuant to the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations 2015,
the Board has carried out an annual performance, the directors individually as well as the
evaluation of the working of its Audit and Nomination & Remuneration Committees.
NUMBER OF BOARD MEETINGS HELD DURING THE FINANCIAL YEAR AND THE DATES OF THE BOARD
MEETINGS:
The Board met during the financial year 2020-21 as follows & the dates on which the
above-Board meetings were held are as follows:
30th May 2020; 30th June 2020, 31st July 2020, 5th September 2020, 15th September 2020,
14th November 2020, and 13th February 2021.
DIRECTORS AND INDEPENDENT DIRECTORS
Sri. Tammareddy Bharadwaja (DIN: 07332749) was regularised as Director, in the last
AGM, and Sri. Sakhamuri Sreenivasa Rao was appointed as an Independent Director of the
Company.
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 SEBI (LODR)
Regulations 2015. The Company has received declarations from the Independent Directors of
the Company to the effect that they are meeting the criteria of independence as provided
in Sub-section (6) of Section 149 of the Companies Act, 2013 and are available for
inspection at the registered office of the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(3) (c) of the Companies Act, 2013, with
respect to Director's responsibilities Statement it is hereby confirmed:
a. That in preparation of the annual accounts, the applicable accounting standards have
been followed along with proper explanation relating to material departures;
b. That 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 ended 31st March, 2021 and of the profit and loss of the company for that
period;
c. That the directors have 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;
d. That the directors have prepared the annual accounts on a going concern basis.
e. that proper internal financial controls were in place and that the financial
controls were adequate and were operating effectively;
f. That systems to ensure compliance with the provisions of all applicable laws were in
place and were adequate and operating effectively.
POLICIES
Material Subsidiary
During the year ended March 31, 2021, the Company does not have any material
listed/unlisted subsidiary companies as defined in SEBI (LODR) Regulations. The policy on
determining material unlisted subsidiary of the Company is approved by the Board of
Directors of the company.
Vigil Mechanism
The Board of Directors of the company are committed to maintain the highest standard of
honesty, openness and accountability and recognize that employees have important role to
play in achieving the goal. As a public company the integrity of the financial matters of
the Company and the accuracy of financial information is paramount. The stakeholders of
the Company and the financial markets rely on this information to make decisions. For
these reasons, the Company must maintain workplace where it can retain and treat all
complaints concerning questionable accounting practices, internal accounting controls or
auditing matters or concerning the reporting of fraudulent financial information to our
shareholders, the Government or the financial markets. The employees should be able to
raise these free of any discrimination, retaliation or harassment. Pursuant to the policy,
employees are encouraged to report questionable accounting practices to Dr. DVN Raju,
Chairman of Audit Committee through email or by correspondence through post.
Details of Subsidiaries, Associate Companies, and Joint Venture Companies, including in
the consolidated financial statements:
The Company do not have Subsidiaries, Associate Companies, and Joint Venture Companies.
So, the financials of the Company do not require to be prepared on consolidated basis.
Material changes and commitments affecting the financial position.
During the period under review, there is no event & Material change and commitments
affecting the financial position.
Company's policy on director's appointment & remuneration.
The company has a policy on Directors' appointment & Remuneration and the same will
be implemented whenever the appointments take place.
Particulars of loans, Guarantees or investments.
During the period under review, there were no loans / Guarantees / Investments taken /
provided by the Company.
Particulars of contract or arrangement with related party
During the period under review, there were no contract or arrangement with related
party except as provided in the Auditor's Report.
Annual evaluation of its own & Board committees' performance.
The company has a policy on Board & Committees' evolution & performance and the
same is being reviewed on quarterly basis.
Implementation of risk management policy.
The company has a policy on risk management and the same is implemented by the Company
to mitigate the risk in the business.
Policy on CSR initiatives
The Company need not have to make constitute a policy for CSR as the same is not
applicable to the Company.
Post Balance Sheet events
There are no material events after the 31st March 2021 till the signing of this Annual
Report, which has significant impact on the business of the Company.
Disclosure about Cost Audit
The requirement of maintaining the cost Audit Records is not applicable to the Company
Disclosure about ESOP and Sweat Equity Share
There are securities issued on ESOP basis / Sweat Equity.
Familiarisation programme for Independent Directors
Pursuant to the provisions of SEBI (LODR) Regulations, the Company has formulated a
programme for familiarising the Independent Directors with the company, their roles,
rights, responsibilities in the company, nature of the industry in which the company
operates, business model of the company etc through various initiatives.
Key Managerial Personnel
Sri. GV Narasimha Rao - Executive Director of the Company is the Chief Executive
Officer of the Company (CEO) and Sri. MVRS Suryanarayana, Chief Financial Officer (CFO) of
the Company shall act as the Compliance Officer; both are the Key Managerial Personnel in
accordance with the Section 203 of the Companies Act, 2013.
During the period under review, the Company has not appointed a Qualified Company
Secretary due to high cost expected by the Company Secretary and shall appoint them as
soon as possible.
Related Party Transaction
Policy on dealing with Related Party Transactions is approved by the Board. No related
party transactions were entered into during the financial year under review, except
remuneration to managerial personnel, there are no materially significant related party
transactions made by the Company with Promoters, Directors, Key Managerial Personnel or
other designated persons which may have a potential conflict with the interest of the
Company at large. The same was discussed by the Audit Committee as also the Board. The
policy on Related Party Transactions as approved by the Board. None of the Directors has
any pecuniary relationships or transactions vis-a-vis the Company.
Internal Financial Controls
The Company has in place adequate internal financial controls with reference to
financial statements. Periodic audits are undertaken on a continuous basis covering all
the operations i.e., manufacturing, sales & distribution, marketing, finance, etc.
Reports of internal audits are reviewed by management from time to time and desired
actions are initiated to strengthen the control and effectiveness of the system.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit
Report in Form MR-3 is obtained by the company from Puttaparthi Jagannatham & Co.,
Practising Company Secretaries, Hyderabad and forms part of this Annual report.
Explanation to the qualifications mentioned in the Secretarial Audit Report in Form
MR-3 obtained from Puttaparthi Jagannatham & co., Practising Company Secretaries,
Hyderabad:
1. The Company is in the process of appointing a Qualified Company Secretary as its
Compliance Officer and shall comply the same as soon as possible
2. The Company shall update its website with all necessary postings in its website
immediately.
3. There were instances of non-filing/delay in filing of compliances with the Stock
Exchange during the financial year, it was due to inadvertence, and due to outbreak of
COVID-19.
Disclosures pursuant to the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014
The details of remuneration paid to the Managerial Personnel are as under -
1. The Disclosures pursuant to sub-rule (1) of Rule 5 of The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 are forms part of the Board's Report.
2. The Disclosures pursuant to sub-rule (2) of Rule 5 of The Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company
forms part of the Board's Report.
Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration Committee
framed a policy for selection and appointment of Directors, Senior Management and their
remuneration. The details pertaining to criteria for determining qualifications, positive
attributes and independence of a Director and remuneration policy have been provided in
Section of the attached Corporate Governance Report.
Significant and Material Orders Passed by the Regulators or Courts
There are no significant material orders passed by the Regulators/Courts which would
impact the going concern status of the Company and its future operations.
Reply to the Qualifications / Reservation in the Audit Report / Secretarial Audit
Report
Statutory Auditors of the Company, has made the following qualification / reservations
on the financial statements for the period ended on 31st March 2021, and the reply of
management is as follows:
1. The Company has not paid the GST liability upto 31st March 2021.
Management's Response:
The GST liability as on 31st Mach 2021, could not be paid due to the suspension of the
registration of the GST registration. The company made appeal and it is under active
consideration of the department for restoration of the same. On resolving of the issue,
the company will proceed to affect the payments.
2. The Company has not submitted the physical verification reports of inventory
aggregating to Rs. 13,13, 13, 770/- as at 31st March 2021, and no provision for impairment
has been made therein. In the absence of alternative corroborative evidence, we are unable
to comment on carrying value of inventory and realizable value of the same.
Management's Response:
The amount has been spent by the company over the past years and the company does not
have any inventory to be valued as on date as the inventory pertains to the production of
films in the past and it is not practically verifiable at this point of time due to
practical difficulties involved in the typical film production.
3. The Company has not submitted the confirmations of Trade Payables and Trade
Receivables. In the absence of alternative corroborative evidence, we are unable to
comment on the extent to which such balances are payable ore receivable.
Management's Response:
The company as per customary practice has issue letters to the trade creditors as well
as to the Trade debtors and no response has been received and as such the company is not
able to confirm the
The Secretarial Auditors i.e., Puttaparthi Jagannatham & Co. has made
qualifications in their Secretarial Audit Report, regarding appointment of Key Managerial
Personnel (CS). The Company is in the process of appointing the same soon and will comply
with the Corporate Governance Requirements. There were instances of non-filing/delay in
filing of compliances with the Stock Exchange during the financial year; it was due to
inadvertence, and due to outbreak of COVID-19.
The Company has set in place the compliance adherence mechanism and is reviewed
quarterly to achieve 100% compliance status.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirements
of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act
2013. An Internal committee has been set up to redress the complaints received regarding
sexual harassment at workplace. All employees including trainees are covered under this
policy.
PERSONNEL
The relationship between the management and the staff was very cordial throughout the
year under review. Your directors take this opportunity to record their appreciation for
the cooperation and loyal services rendered by the employees.
ACKNOWLEDGEMENTS
Your directors place on records their appreciation of the continuous assistance and
co-operation extended to your Company by the valued customers, bankers, Reserve Bank
India, SEBI, Bombay Stock Exchange Limited & National Stock Exchange of India Limited
and all other regulatory Authorities. The Directors also sincerely acknowledge the
significant contributions made by all the employees for their dedicated services to the
Company.
|
By Order of the Board of Directors |
|
Sd/- |
| Place: Hyderabad |
(G.V.Narasimha Rao) |
| Date: 2nd September 2021 |
CEO & Executive Director |