The National Film Development Corporation (NFDC) is under the government scanner with the Information and Broadcasting (I&B) Ministry ordering a special audit of the central public sector enterprise this month.
Sources said the audit has been ordered in the wake of alleged irregularities in its functioning, transgressing its mandate, and the way money was spent by the country’s premier film production body.
Sources said the issue of audit was in the pipeline even before Manish Tewari took over as the new I&B minister. A senior officer in the ministry had made stringent observations on the working of NFDC and now the audit has been ordered.
“The government gives money to the NFDC. So we wanted to see how this money is spent,” an I&B Ministry official told Express.
After the NFDC, audit of the body that runs India International Film Festival every year in Goa would be conducted. During the current fiscal, the I&B Ministry had proposed to give `18.75 crore for producing films in various Indian languages.
As the audit order has led to the freezing of grant-in-aid, the NFDC in its June 14 notice posted on its website has informed that it would not accept applications for production of films till further notice.
The NFDC has been a pioneer in producing art cinema in the country and has helped launch several actors and directors. Some of the landmark films it produced are Mirch Masala, Jaane Bhi Do Yaaro, Pestonjee, Salaam Bombay and Ek Doctor Ki Maut. These films became cult classics and won several prestigious awards. The recent Punjabi production -- Anhe Ghore Da Daan -- won several national and international awards.
Sources said the order also barred the NFDC from collecting revenues from advertising agencies. Though its primary function is to promote good cinema in the country and also market it abroad, the NFDC had started producing advertising campaigns for the government and private agencies.
In 2011-2012, the NFDC earned a revenue of `197 crore by making media campaigns for the government and private bodies. It also prepared tableaus for various government departments for the Republic Day parade. It is also involved in litigation to recover `24 crore from various advertising agencies, accumulated over the last 10 years.