Muzali Arts Ltd Directors Report

Dear Shareholders,

Your Directors have pleasure in presenting the Annual Report together with the Audited Accounts of the Company for the Financial Year ended 31^st March, 2025.

1. FINANCIAL RESULTS:

The Financial Highlights for the year under report are as under:

(Amount in Indian Rupees Lakhs)

Particulars	Standalone
	31st March 2025	31st March 2024
Total Revenue	46.32	61.68
Total Expenses	327.99	168.63
Profit before tax	(281.67)	(106.95)
Profit after tax	(293.72)	(106.95)
Total Comprehensive Income for the period	(293.72)	(106.95)

2. TRANSFER TO RESERVES

There are no transfers to any specific reserves during the year.

3. THE STATE OF THE COMPANYS AFFAIRS

During the year under review, your company achieved total revenue from operations of Rs. 46.32 lakhs (previous year Rs. 61.68 lakhs). The loss after tax (including other comprehensive income) is at Rs. (293.72) lakhs [previous year Rs. (106.95) lakhs].

4. SHARE CAPITAL

Authorised Share Capital:

The Authorised Share Capital of the Company is Rs. 6,00,00,000 divided in to 6,00,00,000 Equity Shares of Re. 1/- each.

Issued Subscribed, Paid-up Share and Listed Capital:

The Issued Subscribed, Paid-up Share and Listed Capital of the Company is Rs. 5,91,64,667 divided in to 5,91,64,667 Equity Shares of Re. 1/- each.

During the year there is no change in the Authorised Share Capital and Issued Subscribed and Paid-up Share Capital of the Company.

5. DIVIDEND

The board does not recommend any dividend for the financial year 2024-2025.

6. CASH FLOW AND CONSOLIDATED FINANCIAL STATEMENTS

As required under Regulation 34 of the Listing Regulations, a Cash Flow Statement and consolidated Financial Statement is part of the Annual Report.

7. THE CHANGE IN THE NATURE OF BUSINESS, IF ANY;

There is no change in the nature of business of the Company.

8. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND.

There was no transfer during the year to the Investor Education and Protection Fund in terms of Section 125 of the Companies Act, 2013.

9. CONSERVATION OF ENERGY-TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE ETC.

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134 (3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is furnished as Annexure A to Directors Report.

10. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY.

The risk management committee compliance is not applicable to the Company.

11. COMMENTS BY THE BOARD ON QUALIFICATION, RESERVATION OR ADVERSE REMARK OR DISCLAIMER MADE BY THE AUDITORS IN THEIR REPORT:

Statutory Auditor remarks in the Standalone audit report

Basis for disclaimer of opinion

• The company has written off Debtor amounting to Rs. 14,49,809.15, advance payment amounting to Rs 2,100 & other balance written off amounting to Rs 25,25,606.88, Due to lack of proper documentation for the Debtor written-off, advances written off & other balance written off raises concerns about the completeness and accuracy of the accounts payable balance / advances balance sand the adequacy of the companys internal controls over financial reporting. Without sufficient evidence, we cannot determine whether the write-off is appropriate and whether the financial statements fairly present the companys financial position and results of operations.

• As per the financial statements, Loans and Advances (net) amount to ?6,55,20,161.00 as on March 31, 2025. We were unable to obtain independent balance confirmations or perform alternate audit procedures to verify these balances. In the absence of sufficient and appropriate audit evidence, we are unable to comment on the accuracy and recoverability of the reported Loans and Advances.

• The audit of standalone financial statement for the year ended 31st March 2024, included in the result was carried out and reported by Gupta Ravi & Associates who has expressed disclaimer of opinion vide their report dated 7th December 2024 and basis of opinion are as follow:

(i) The company has written off Creditor amounting to Rs 15,74,393.30, advance payment amounting to Rs

11.56.300 & other balance written off amounting to Rs 9,75,000.00, Due to lack of proper documentation for the creditor written-off , advances written off & other balance written off raises concerns about the completeness and accuracy of the accounts payable balance / advances balances and the adequacy of the companys internal controls over financial reporting. Without sufficient evidence, we cannot determine whether the write-off is appropriate and whether the financial statements fairly present the companys financial position and results of operations.

(ii) As per the financial statement, the total trade receivable outstanding amounts to Rs. 1,83,80,138,41/- and trade payable amounts to Rs. 15,92,102.40/- as on March 31, 2024. We are unable to obtain independent balance confirmations and perform any alternate procedures. We are unable to comment if any adjustments to the carrying value of trade receivable and trade payable is required if any.

(iii) As per the financial statement, the total Loan given amounting to Rs 5,08,28,307.00 and loan taken amounting to Rs 24,33,609 as on March 31, 2024. We are unable to obtain independent balance confirmations and perform any alternate procedures. In the absence of the same, we are unable to comment on the carrying value of Loan given.

(iv) Under the Micro, Small and Medium Enterprises Development Act, 2006 certain disclosures are to be made relating to Micro, Small and Medium Enterprises. The company has sought relevant information from its suppliers / providers of services under the Act, and since the relevant information has not been shared with us, we are unable to comment on the impact if any applicable.

We were unable to obtain sufficient appropriate audit evidence or adequate documentation to verify the basis of the

disclaimer of opinion issued by the previous auditor, as referenced in points (i) to (iv) above.

• We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on financial statement.

• We draw attention to the fact that audit of standalone financial statement for the year ended 31st March 2024, included in the annual return was carried out and reported by Gupta Ravi & Associates who has expressed disclaimer of opinion vide their report dated 7th December 2024 and basis of opinion are as follow:

(i) The company has written off Creditor amounting to Rs 15,74,393.30, advance payment amounting to Rs

11.56.300 & other balance written off amounting to Rs 9,75,000.00, Due to lack of proper documentation for the creditor written-off , advances written off & other balance written off raises concerns about the completeness and accuracy of the accounts payable balance / advances balances and the adequacy of the companys internal controls over financial reporting. Without sufficient evidence, we cannot determine whether the write-off is appropriate and whether the financial statements fairly present the companys financial position and results of operations.

(ii) As per the financial statement, all the interest income was not recognized during the period under audit, we requested an explanation from the management regarding the omission of interest income. However, we did not receive any satisfactory explanation as to why interest income was not recognized for the entire period. In the absence of any information regarding the interest receivable to be booked, we are unable to comment on the impact of this on companys financial position and resultsof operations.

(iii) We noted a significant deficiency in the documentation of sales transactions that occurred in the fourth quarter with no invoice, ewaybill and GST return on record for verification. The lack of proper documentation for these sales transactions limited our ability to obtain sufficient appropriate audit evidence to support the accuracy and completeness of sales revenue recorded in the fourth quarter. This significantly impacts our assessment of the risk of material misstatement in the financial statements. Due to this we are unable to comment on whether the financial statements fairly present the companys financial position and results of operations.

(iv) The Company failed to provide us with the GST reconciliation statement / GST return for the period under review. These reconciliation / return statement are crucial for verifying the accuracy and completeness of GST- related entries in the financial statements. In the absence of the same, we are unable to comment on the financial position and result of operations.

(v) Lack of Supporting Documentation for Professional Fees & Employee Benefit Details. This limitation restricted our ability to verify the accuracy and completeness of expenses related to professional fees & Employee Benefit Exp. In the absence of the same, we are unable to comment on the financial position and result of operations.

(vi) The company has not recorded expenses for electricity, warehouse rent, and employee provident fund contributions. The omission of expenses will result in an understatement of expenses and an overstatement of net income for the period. In the absence of the same, we are unable to comment on the financial position and result of operations.

(vii) As per the financial statement, the total trade receivable outstanding amounts to Rs. 1,83,80,138,41/- and trade payable amounts to Rs. 15,92,102.40/- as on March 31, 2024. We are unable to obtain independent balance confirmations and perform any alternate procedures. We are unable to comment if any adjustments to the carrying value of trade receivable and trade payable is required if any.

(viii) As per the financial statement, the total Loan given amounting to Rs 5,08,28,307.00 and loan taken amounting to Rs 24,33,609 as on March 31, 2024. We are unable to obtain independent balance confirmations and perform any alternate procedures. In the absence of the same, we are unable to comment on the carrying value of Loan given.

(ix) Under the Micro, Small and Medium Enterprises Development Act, 2006 certain disclosures are to be made relating to Micro, Small and Medium Enterprises. The company has sought relevant information from its suppliers / providers of services under the Act, and since the relevant information has not been shared with us, we are unable to comment on the impact if any applicable.

(x) The amount represented under the head (Cash in hand), we have not been provided by the management with any appropriate information, explanation and justification for such a cash balance as well as transactions carried out by the company in cash. On account of this and in the absence of documentation we are unable to verify and form an opinion on such cash and cash transactions carried out by the company.

(xi) Secretarial Compliances have not been done by the company since last two financial year. Also presently there is no compliance officer in the company who can be held responsible for this. Due to this we are unable to comment on the penal / legal consequences on the financial position and result on operations.

(xii) The companys continued existence is severely threatened. Since October 2023, it has operated without any employees, has liquidated its entire inventory at a loss, No steps have been taken by the company to lift the trading suspension imposed by the Bombay Stock Exchange (BSE) and has completely neglected its secretarial obligations. These critical factors cast serious doubt on the companys ability to remain in business. These conditions indicate uncertainty that may cast significant doubt on the companys ability to continue as going concern.

We have been relied upon above points for the purpose of our review of the Audited result. Our opinion is also modified to the extent reflected in above points.

• Attention is hereby drawn to Company had purchased 80% stake in Jalan & Jalan Collection Inc during FY 202021. During FY 2022-23, dispute arose between Company & minority shareholder & company filed a case against the minority shareholder alleging misfeasance, misrepresentation & misappropriation at District Mediation Center, Nagpur on 19-05-2022.

Company has been trying relentlessly to obtain sufficient data from Subsidiary in order to facilitate Consolidation of financials for reporting purposes. However, due to unavailability of subsidiary financial data, the company has not been able to present consolidated financial statements since June 21 quarter.It is also be noted company has no active operation since October 2022.

Company has during current year again made an assessment of its Control and power over subsidiary as per Ind AS 110 & management has determined that the company does not possess significant control and power over its subsidiary, Jalan Jalan Collection Inc., despite holding an 80% shareholding. Hence, Jalan & Jalan Collection Inc., does not qualify as a subsidiary.

Next step on evaluation done by Management was whether the investment qualifies as an Investment in Associate as per Ind AS 28. As per Ind AS 28, If an entity holds, directly or indirectly (eg through subsidiaries), 20 per cent or more of the voting power of the investee, it is presumed that the entity has significant influence, unless it can be clearly demonstrated that this is not the case. An entity loses significant influence over an investee when it loses the power to participate in the financial and operating policy decisions of that investee. The loss of significant influence can occur with or without a change in absolute or relative ownership levels. Management is of the view that the Company has no role to play in any financial or operating decisions of Jalan & Jalan Collection Inc. as the same is under control of Minority shareholder & hence Company is unable to exercise significant influence by virtue of its shareholding.

On review, management also concluded that previous classification of Jalan & Jalan Collection Inc., as a subsidiary in previous financials was erroneous & it was never a subsidiary. As per Ind AS 8, retrospective effect needs to be given for Prior period error. However, since Company has not presented consolidated financial statements since June 21, management concludes that restated results would be similar to standalone financials with the only exception being that Investments in Jalan & Jalan Collection Inc. would not be classified as Investment in Subsidiary under Schedule for Investments.

Consequently, the company has not prepared consolidated financial statements in accordance with Ind AS 110 & will account for investment in Jalan & Jalan Collection Inc. as per Ind AS 109 - Financial Instrument.

As per Ind AS 109, Company records Investments in equity instruments at Fair value through Profit and Loss account. Company has obtained a fair valuation report on 27th April, 2024 for its investment in Jalan & Jalan Collection Inc. Based on valuation report, fair value of the company is Rs. -76,736.87/- based on whatever past data was available with the company. Hence, management has recorded the Investment in Jalan & Jalan Collection Inc. at zero rupees in its books.

Directors comment on remarks

The detailed comment on the same has been mentioned in the Statement on Impact of Audit Qualifications standalone & consolidated for the year ended 31st March 2024.

Secretarial Auditor remarks in the Secretarial audit report

i) Disclaimer of Opinion in the Auditors Report.

ii) The company had received Notice No. 20240327-24 on 27th March 2024 from BSE Limited for Suspension of trading in securities of companies for non-compliances with provisions of certain Regulations of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015;

iii) The Company has filed the Audited Standalone Financial Statements of the Company for the Financial Year ended 31st March, 2024 on 07th December 2024;

iv) The Company has not appointed a Company Secretary & Compliance Officer since 17th October 2024, in violation of Section 203 of the Companies Act, 2013 and Regulation 6 of SEBI (LODR) Regulations, 2015.

v) The Company has uploaded Annual Report for FY 23-24 beyond the prescribed time period as per Regulation 34(1) of SEBI LODR.

Directors comment on remarks

i) The Company has submitted its detailed comments in the Statement on Impact of Audit Qualifications (Standalone and Consolidated) for the year ended 31st March, 2024;

ii) In response to the Notice No. 20240327-24 on 27th March 2024 from BSE Limited for Suspension of trading in securities the Company has filed Revocation In Principal Approval on 10^th April 2024 with BSE Limited and the same is under process.

iii) We confirm that the Audited Standalone Financial Statements of the Company for the financial year ended 31st March 2024 were filed on 07th December 2024;

iv) The Company has appointed a Company Secretary & Compliance Officer on 06th June 2025. The delay in appointment was unintentional, and the Company has since complied with the provisions of Section 203 of the Companies Act, 2013 and Regulation 6 of the SEBI (LODR) Regulations, 2015.

v) We confirm that the Annual Report for FY 23-24 beyond the prescribed time period as per Regulation 34(1) of SEBI LODR.

12. INTERNAL CONTROL SYSTEM

The Companys internal controls system has been established on values of integrity and operational excellence and it supports the vision of the Company "To be the most sustainable and competitive Company in our industry". The Companys internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors and their significant audit observations and follow up actions thereon are reported to the Audit Committee.

13. DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The provisions of Section 135 of the Companies Act relating to Corporate Social Responsibility are not applicable as the Company is having Net worth less than rupees Five Hundred Crore, Turnover less than rupees One Thousand Crore and Net Profit less than rupees Five Crore.

14. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The particulars of investments made and loans given to subsidiaries has been disclosed in the financial statements. Also, Company has not given any guarantee during the year under review.

15. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES All the

related party transactions are entered on arms length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. There are no materially significant related party transactions made by the Company with Promoters, Directors or Key Managerial Personnel etc. which may have potential conflict with the interest of the Company at large or which warrants the approval of the shareholders. The details of the transactions with Related Party are provided in the Companys financial statements (note 24) in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions. The Related Party Transactions Policy as approved by the Board is uploaded on the Companys website at office@muzaliarts.com

16. POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has zero tolerance towards sexual harassment at the workplace and towards this end, has adopted a policy in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act/ Posh Act was enacted by the Government of India in 2013. It is a major step by the GOI for preventing any form of misconduct on the women at workplace. POSH Act is applicable on each and every Company, workspace, establishment or organisation employing 10 or more employees whether full time, part time, interns or on contract, irrespective of its nature of industry of location.

17. ANNUAL RETURN

Pursuant to the provisions of Section 92(3) of Companies Act, 2013 following is the link for Annual Return 2024-2025 office@muzaliarts.com

18. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW

During the financial year, the Board met 07 times during the financial year.

19. DIRECTORS RESPONSIBILITY STATEMENT

In terms of Section 134(5) of the Companies Act, 2013 The Board of Directors of the Company hereby confirm:

• That in the preparation of the annual accounts, the applicable accounting standards have been followed and there has been no material departure.

• That the selected accounting policies were applied consistently and the directors 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 as on 31st March, 2025, and that of the profit of the Company for the year ended on that date.

• That proper and sufficient care has been taken 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.

• That the annual accounts have been prepared on a going concern basis.

• The Board has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

• 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.

20. DEPOSITS

The Company has neither accepted nor renewed any deposits during the year under review.

21. PARTICULARS OF EMPLOYEES AND REMUNERATION

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 is given as Annexure B to this report. In terms of provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of employees drawing remuneration in excess of the limits set out in the said Rules, if any, forms part of the Report. The Nomination and Remuneration Committee of the Company has affirmed at its meeting held on 28^th March, 2025 that the remuneration is as per the remuneration policy of the Company.

The policy is available on the Companys website office@muzaliarts.com

22. CHANGES IN DIRECTORS AND KEY MANAGERIAL PERSONNEL

As on date the following are the Director and Key Managerial Personnel of The Company.

DIN	Name	Designation
08965751	Mansoorbhai Murtuza	Director & CFO
09221054	Dinkal Manish Doshi	Independent Director
10581203	Naresh Gopani	Non - Executive Non -Independent Director
09629728	Sohan Chaturvedi	Independent Director
09629926	Siddhesh Shankar Shende	Independent Director

During the year the following changes have taken place.

Name of Director KMP	Designation	Event	Date
Mr. Naresh Gopani	Non-Executive Non- Independent Director	Appointment	05-04-2024
Ms. Pallavi Ronit Passwala	Company Secretary & Compliance Officer	Resignation	16-10-2024
Mr. Lalit Raut	Director	Resignation	09-04-2024

23. ATTRIBUTES, QUALIFICATIONS & INDEPENDENCE OF DIRECTORS, THEIR APPOINTMENT AND REMUNERATION

The Nomination & Remuneration Committee of Directors have approved a Policy office@muzaliarts.com for Selection, Appointment and Remuneration of Directors which inter-alia requires that composition and remuneration is reasonable and sufficient to attract, retain and motivate Directors, KMP and senior management employees and the Directors appointed shall be of high integrity with relevant expertise and experience so as to have diverse Board and the Policy also lays down the positive attributes/ criteria while recommending the candidature for the appointment as Director

24. DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosures to the Board that they fulfil all the requirements as stipulated in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 so as to qualify themselves to be appointed as Independent Directors under the provisions of the Companies Act, 2013 and the relevant SEBI Listing Regulations.

25. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

The familiarisation program aims to provide Independent Directors with the pharmaceutical industry scenario, the socio-economic environment in which the Company operates, the business model, the operational and financial performance of the Company, significant developments so as to enable them to take well informed decisions in a timely manner. The familiarisation program also seeks to update the Directors on the roles, responsibilities, rights and duties under the Act and other statutes. The policy on Companys familiarisation program for Independent Directors is posted on Companys website at office@muzaliarts.com

26. STATUTORY AUDITORS

M/s. Bilimoria Mehta & Co., Chartered Accountants, (Firm Registration No. 101490W), were appointed as Statutory Auditors for a period of 5 years, commencing from the conclusion of the 29^th Annual General Meeting held on 30th September 2024 till the conclusion of the 34^th Annual General Meeting of the Company to be held in the year 2029.

The Notes on Financial Statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The qualification, reservation, observation, adverse remark, or disclaimer reported in the Statutory Auditors report for the year ended 31st March 2025 forming part of the Annual Report are selfexplanatory and do not call for any further comments.

Further, The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company in the year under review.

27. SECRETARIAL AUDIT REPORT

A Secretarial Audit was conducted during the year by the Secretarial Auditor, M/ s. Nuren Lodaya and Associates, Practicing Company Secretaries, Mumbai, in accordance with Provisions of Section 204 of the Act. The Secretarial Auditors Report is attached as Annexure C and forms part of this Report

28. COST RECORDS AND COST AUDIT

The provision of the Companies (Cost Records and Audit) Rules, 2014 is not applicable to the Company. Maintenance of cost records as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 was not applicable for the business activities carried out by the Company for the FY 2024-2025. Accordingly, such accounts and records are not made and maintained by the Company for the said period.

29. CORPORATE GOVERNANCE

The Company is committed towards maintaining the highest standards of Corporate Governance and adhering to the Corporate Governance requirements as set out by Securities and Exchange Board of India. The provision of Corporate Governance is not applicable to the Company.

30. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Managements Discussion and Analysis Report for the year under review, as stipulated under regulation 34 (3) and Part B of schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is annexed to this Annual Report as Annexure D.

31. SUBSIDIARY, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Holding, Subsidiary, Joint Ventures And Associate Companies.

32. VIGIL MECHANISM

The Company has established a vigil mechanism policy to oversee the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimisation of employees and Directors who express their concerns. The Company has also provided direct access to Mr. Mansoorbhai Murtuza on reporting issues concerning the interests of co-employees and the Company. The Vigil Mechanism Policy is available at the website of the Company.

33. REPORTING OF FRAUD BY AUDITORS

During the year under review, the Internal Auditors, Statutory Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under section 143(12) of the Act, details of which needs to be mentioned in this Report.

34. PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and SEBI Listing Regulations, your Company has devised a policy containing criteria for evaluating the performance of the Executive, Non-Executive and Independent NonExecutive Directors, Key Managerial Personnel, Board and its Committees based on the recommendation of the Nomination & Remuneration Committee. Feedback was sought by way of a structured questionnaire covering various aspects of the Boards functioning, such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations, and governance. The manner in which the evaluation has been carried out is explained in the Corporate Governance Report, forming part of this Annual Report.

The Board of Directors of your Company expressed satisfaction about the transparency in terms of disclosures, maintaining higher governance standards and updating the Independent Directors on key topics impacting the Company.

35. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There are no material changes and commitments affecting the financial position of the Company occurred

during the financial year.

36. THE DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANYS OPERATIONS IN FUTURE

During the year there has been no significant material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and companys operations in future.

37. COMMITTEES OF THE BOARD

In accordance with the Companies Act, 2013, the Board has formed a Risk Management Committee. There are currently seven Committees of the Board, as follows:

• Audit Committee:

• Nomination and Remuneration Committee:

• Stakeholders Relationship Committee.

AUDIT COMMITTEE

The Audit Committee of the Company is constituted in line with the provisions of Section 177 of the Companies Act, 2013 read with regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Audit Committee as on the date of the report comprises of 3 Non-Executive Independent Directors.

As on date following are the members of the Committee as mentioned below.

Sr. #	Name of Director	Position	Designation
1	Sohan Chaturvedi	Chairperson	Non-Executive Independent Director
2	Siddhesh Shankar Shende	Member	Non-Executive Independent Director
3	Dinkal Manish Doshi	Member	Non-Executive Independent Director

During the year there were in total 4 Audit committee meetings. The Chairperson of Audit Committee was present in previous AGM held on 30 Dec 2024 to answer shareholders queries.

Broad terms of reference of the Audit Committee are as per following:

The role of the audit committee shall include the following:

1 Oversight of the listed entitys financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;

2 Recommendation for appointment, remuneration and terms of appointment of auditors of the listed entity;

3 Approval of payment to statutory auditors for any other services rendered by the statutory auditors;

4 Reviewing with the management, the quarterly financial statements before submission to the board for approval;

5 Reviewing and monitoring the auditors independence and performance and effectiveness of audit process.

7 Approval or any subsequent modification of transactions of the listed entity with related parties.

8 Evaluation of internal financial controls and risk management systems.

9 reviewing, with the management, performance of statutory and Internal Auditors, adequacy of the internal control systems.

10 Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.

11 Discussion with internal auditors of any significant findings and follow up there on.

12 Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.

13 Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.

14 To review the functioning of the whistle blower mechanism.

15 Approval of appointment of chief financial officer after assessing the qualifications, experience and background, etc. of the candidate.

16 Carrying out any other function as is mentioned in the terms of reference of the audit committee

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee of the Company is constituted in line with the provisions of Section 178 of the Companies Act, 2013 read with regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Committee comprises of 3 Non-Executive Independent Directors.

The Following are the members of the Committee as mentioned below.

Sr. #	Name of Director	Position	Designation
1	Sohan Chaturvedi	Chairperson	Non-Executive Independent Director
2	Siddhesh Shankar Shende	Member	Non-Executive Independent Director
3	Dinkal Manish Doshi	Member	Non-Executive Independent Director

The Nomination and Remuneration Committee met on 3 time during the year.

The necessary quorum was present in the said meetings.

The Chairman of the Nomination and Remuneration Committee was present at the last Annual General Meeting of the Company held on 30 Dec 2024.

Role of nomination and remuneration committee, inter-alia, include the following:

(1) Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board of Directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees;

(2) Formulation of criteria for evaluation of performance of independent directors and the board of directors;

(3) Devising a policy on diversity of board of directors;

(4) Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down and recommend to the board of directors their appointment and removal.

(5) Whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.

(6) To recommend to the Board all remuneration, in whatever form, payable to senior management.

The policy on directors appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters is available on companys website.

Remuneration of Directors

The remuneration of the Managing Director and Whole- Time Director is recommended by the Remuneration Committee and then approved by the Board of Directors and subsequently by the shareholders in general meeting within the limits prescribed in Companies Act, 2013.

Criteria for making payments

Non-Executive Directors of the Company are paid sitting fees for attending Board and Committee Meetings and no Commission is drawn by either of them during the year.

Performance evaluation criteria for Independent Directors:

1) Attendance and participations in the meetings.

2) Preparing adequately for the board meetings.

3) Contribution towards strategy formation and other areas impacting company performance

4) Rendering independent, unbiased opinion and resolution of issues at meetings.

5) Safeguard of confidential information.

6) Initiative in terms of new ideas and planning for the Company.

7) Timely inputs on the minutes of the meetings of the Board and Committees.

8) Raising of concerns to the Board

Remuneration Policy

The Nomination and Remuneration Policy devised in accordance with Section 178(3) and (4) of the Companies Act, 2013 is available at the website of the Company: www.muzaliarts.com Further, criteria of making payments to nonexecutive directors, the details of remuneration paid to all the Directors and the other disclosures required to be made under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 have been published below:

STAKEHOLDER RELATIONSHIP COMMITTEE

The Stakeholder Relationship Committee of the Company is constituted in line with Regulation 20 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Committee comprises of 3 Non-Executive Independent Directors.

As on date following are the members of the Committee as mentioned below.

Sr. #	Name of Director	Position	Designation
1	Sohan Chaturvedi	Chairperson	Non-Executive Independent Director
2	Siddhesh Shankar Shende	Member	Non-Executive Independent Director
3	Dinkal Manish Doshi	Member	Non-Executive Independent Director

The committee investigates the shareholders and investors grievances that are not settled at the level of Compliance Officer and helps to expedite the share transfers and related matters. The Committee periodically reviews the status

of stakeholders grievances and redressa! of the same.

The Committee met on 4 time during the year.

The necessary quorum was present for all the meetings. The Chairman of the Committee was present at the last Annual General Meeting of the Company held on 30 Dec 2024.

The role of the committee shall inter-alia include the following:

(1) Resolving the grievances of the security holders of the listed entity including complaints related to transfer/ transmission of shares, non-receipt of annual report, non-receipt of declared dividends, issue of new/ duplicate certificates, general meetings etc.

(2) Review of measures taken for effective exercise of voting rights by shareholders.

(3) Review of adherence to the service standards adopted by the listed entity in respect of various services being rendered by the Registrar & Share Transfer Agent.

(4) Review of the various measures and initiatives taken by the listed entity for reducing the quantum of unclaimed dividends and ensuring timely receipt of dividend warrants/annual reports/ statutory notices by the shareholders of the Company.]

38. OTHER DISCLOSURES

The Company does not have any Employees Stock Option Scheme in force and hence particulars are not furnished, as the same are not applicable. No proceedings against the Company is initiated or pending under the Insolvency and Bankruptcy Code, 2016. The details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof - Not Applicable.

39. POLICIES

The Company seeks to promote highest levels of ethical standards in the normal business transactions guided by the value system. The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandates formulation of certain policies for listed companies. The Policies are reviewed periodically by the Board and are updated based on the need and compliance as per the applicable laws and rules and as amended from time to time. The policies are available on the website of the Company at office@muzaliarts.com

40. COMPLIANCE OF APPLICABLE SECRETARIAL STANDARDS

Your Directors hereby confirm that the Company has complied with the necessary provisions of the revised Secretarial Standard 1 and Secretarial Standard 2 to the extent applicable to the Company.

41. ENHANCING SHAREHOLDER VALUE

Your company firmly believes that its success, the marketplace and a good reputation are among the primary determinants of value to the shareholder. The organisational vision is founded on the principles of good governance and delivering leading-edge products backed with dependable after sales services. Following the vision your Company is committed to creating and maximising long-term value for shareholders.

42. CAUTIONARY STATEMENT

Statements in the Boards Report and the Management Discussion & Analysis describing the Companys objectives, expectations or forecasts may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operation include global and domestic demand and supply conditions affecting selling prices of raw materials, finished goods, input availability and prices, changes in government regulations, tax laws, economic developments within and outside the country and various other factors.

43. ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their sincere appreciation and gratitude for the continued cooperation extended by shareholders, employees, customers, banks, suppliers and other business associates.

By Order Of The Board For Muzali Arts Limited

Sd/-

Mr. Mansoorbhai Murtuza

Director & CFO

Din: 08965751

Date: 05^th September 2025