The ministry of corporate affairs (MCA) is planning to file a petition in the division bench of the Bombay High Court to re-open investigations into the affairs of Mukta Arts, the production house of Bollywood producer-director Subhash Ghai which has produced movies such as Yuvraaj, Taal , Hero, Khalnayak .
The Serious Fraud Investigation Office (SFIO) was probing the firm in 2005 with regard to certain investments made by the company in the stock market but it got halted with an interim stay by the Bombay High Court.
An MCA official told FE, ?The ministry is planning to appeal before the division bench of the Bombay High Court to re-start the investigation in Mukta Arts that has been lying pending since 2005.?
Mukta Arts did not respond to an e-mail questionnaire sent by FE more than six days back. The ministry of corporate affairs had found alleged links between Mukta Arts and Ketan Parekh Group (KPG) companies which held certain shares in it. The company had, however, made a statement that the shares were brought from the shareholders of the company and there were no direct transactions between Ketan Parekh Group and Mukta Arts.
Another aspect under lens was the jump in the authorised share capital of the company from Rs 15,000 to Rs 12 crore in just two months.
According to MCA official, ?Apart from violations in the Companies Act, the ministry also wants to investigate that why Mukta Arts invested Rs 83 crore in the share market in the year 2005 and where did the funds come in from.?
Prior to the investigation, the ministry of corporate affairs had conducted an inspection as per Section 209A of the Companies Act into the company which had pointed out certain irregularities and violations.
The inspection had also pointed that the company had been giving loans to one of its directors without proper compliance with the requirements of the Act.