The film is about the life and time of renowned painter Raja Ravi Varma.
"Fortunately, this is based on a novel so there are no chances of any controversy," said Mehta, who is adapting well-known Marathi writer Ranjit Desai's biographical novel "Raja Ravi Varma".
The director is in Goa to attend the 38th International Film Festival of India (IFFI) and said it is a celebration of cinema.
"I feel we should celebrate it like the festivals of our country -- Diwali and Holi. I am a regular at IFFI primarily because I get to meet filmmakers from other parts of the world and also get to see some exciting films that recharge my battery and prepare me to do new work," Mehta told.
He is making his latest film in both English and Hindi and under two different titles -- "Colour of Passion" and "Rang Rasiyaa", respectively.
"Ravi Varma is the most fascinating artist of the era. His character, persona and paintings have fascinated me from my film institute days (Film and Television Institute of India). Then I read the novel by Ranjit Desai and that triggered the script," said Mehta whose Aamir Khan starrer "The Rising" bombed at the box office.
But the director is unaffected by the box office reaction and says cinema is much more than that.
"I don't understand the history of cinema in terms of hits and flops. I feel it is the easiest way of categorising the film. A film is beyond that -- films are part of life. They influence more than anything else as far as we Indians are concerned."
Starring Randeep Hooda, Nandana Sen and Paresh Rawal, "Rang Rasiyaa" will hit theatres in March next year.
When asked what made him chose Randeep for the role, he said: "I watched his films 'Risk' and 'D' and I felt that he is a skilful actor.
Second, I wanted to work with new faces. The film has powerful performances by Randeep, Nandana and of course Paresh Rawal. We are introducing two new faces in the film -- one is a Scottish actress and another is Indian."
Talking about the growth of Indian cinema, Mehta said: "I think Indian cinema is ready to extend out of its boundary. Technically we are doing some exceptional work and there is a group of technicians that has emerged. There are brave new directors telling brave new stories and all this gives me a lot of hope."
Mehta's repertoire includes films like "Mirch Masala" and "Sardar" and he also has the credit of launching Shashi Kapoor's daughter in "Hero Heeralal".