As per Nidhi (Amendment) Rules, 2019, Rule 3A, 23A & 23B was inserted in Companies (Nidhi) Rules, 2014 which came into effect w.e.f. 15.08.2019. Accordingly Every Nidhi company whether incorporated before or after 15.08.2019 are required to get itself declared as Nidhi by filing form NDH-4.
> Rule 3A of Companies (Nidhi) Rules, 2014
A Nidhi incorporated under the Act on or after the commencement of the Nidhi (Amendment) Rules, 2019 (i.e. 15.08.2019) shall file Form NDH-4
> Rule 23A of Companies (Nidhi) Rules, 2014
Every Nidhi incorporated under the Act, before the commencement of Nidhi (Amendment) Rules, 2019, shall also get itself declared as such
- within a period of one year from the date of its incorporation, or;
- within a period of six months from the date of commencement of Nidhi (Amendment) Rules, 2019,
whichever is later
Provided that in case a company does not get itself notified, it shall not be allowed to file Form No. SH-7 (Notice to Registrar of any alteration of share capital) and Form PAS-3 (Return of Allotment).
> Rule 23B of Companies (Nidhi) Rules, 2014
Every Company referred in clause (a) of rule 2 shall file Form NDH-4 along with fees as per the Companies (Registration Offices and Fees) Rules, 2014 for updating its status.
Provided that no fees shall be charged under this rule for filing Form NDH-4, in case it is filed within six month of the commencement of Nidhi (Amendment) Rules, 2019 (i.e. within six month of 15.08.2019).
> Following Compliances should be completed before filing Form NDH-4
| Nidhi Rules, 2014 | Requirement | ||||||||||||
| Rule 3A | Form NDH-4 should have been filed within prescribed time limit. | ||||||||||||
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Rule 4 |
It should be Public Limited Company | ||||||||||||
| Minimum paid up capital should be 5 lacs | |||||||||||||
| It should not have issued any preference shares | |||||||||||||
| Should not have any object other than cultivating the habit of thrift and savings among its members, receiving deposits from and lending to its members only for their mutual benefits. | |||||||||||||
| Name of the Company ends with “Nidhi Limited” | |||||||||||||
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Rule 5 (1) |
Should have at least 200 members at the end of its first FY and onwards | ||||||||||||
| Should have net owned funds of minimum 10 Lacs rupees | |||||||||||||
| unencumbered term deposits should not be less than 10% of outstanding deposits (Rule 14) | |||||||||||||
| Ratio of net owned funds to deposits should not be more than 1:20 | |||||||||||||
| Rule 5 (2) | Within 90days of close of First FY after its incorporation should have filed form NDH-1 | ||||||||||||
| Rule 5 (3) | If members are below 200 and Ratio of net owned funds to deposits is more than 1:20, application must have been filed with Regional Director in form NDH-2 | ||||||||||||
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Rule 6 |
Should not have opened any current account with its members | ||||||||||||
| Shall not acquire another company by purchase of securities or control the composition of the Board of Directors or enter into any arrangement for the change of its management, unless it has passed a special resolution in its general meeting and also obtained the previous approval of the Regional Director | |||||||||||||
| Shall not accept deposits from or lend to any person, other than its members | |||||||||||||
| Shall not pledge any of the assets lodged by its members as security | |||||||||||||
| Shall not take deposits from or lend money to any body corporate | |||||||||||||
| Shall not enter into any partnership arrangement in its borrowing or lending activities | |||||||||||||
| Shall not issue or cause to be issued any advertisement in any form for soliciting deposit | |||||||||||||
| Shall not pay any brokerage or incentive for mobilising deposits from members or for deployment of funds or for granting loans | |||||||||||||
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Rule 7 |
Company should have issued fully paid up equity shares of nominal value of not less than 10 rs. | ||||||||||||
| Should have allotted to each deposit holder at least a minimum of 10 equity shares or shares equivalent to 100 rs.( Provided that a savings account holder and a recurring deposit account holder shall hold at least one equity share of rupees ten) | |||||||||||||
| Rule 8 | Should not admitted a body corporate or trust or minor as its member | ||||||||||||
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Rule 10 |
Company should have earned net profits after tax continuously in the preceding three years before opening branches | ||||||||||||
| Shall not open more than 3 branch within district | |||||||||||||
| If the company has opened more than 3 branches, whether prior permission of Regional Director was obtained and intimation was given to ROC about opening of branch within 30 days of such opening. | |||||||||||||
| No branches or collection centres or offices or deposit centres outside the State where its registered office is situated | |||||||||||||
| No branches or collection centres or offices or deposit centres unless financial statement and annual return (up to date) are filed with the Registrar | |||||||||||||
| In case of closing of any branch should have published an advertisement in a newspaper 30 days prior to closure; copy of advertisement on the notice Board of Nidhi for at least 30 days and intimation to ROC within 30 days of closure. | |||||||||||||
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Rule 13 |
Fixed Deposits & Recurring deposits :
FD Period of acceptance: 6-60 months (minimum to maximum) RD Period of acceptance:12-60 months Rate of interest(ROI): not exceeding the maximum ROI prescribed by the RBI which the NBFCs can pay on their public deposits Repayment: before 3 months: Not allowed 3-6 months: Allowed interest free After 3 months but before maturity: Allowed but ROI will be reduced by 2% |
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| Savings deposit account:
Maximum balance: not more than 1 Lakh rupees Rate of interest: not more than 2% above the rate of interest payable on savings bank account by nationalised banks |
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Rule 15 |
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| Where a Nidhi has not made profits continuously in the three preceding financial years, it shall not make any fresh loans exceeding fifty per cent. of the maximum amounts of loans | |||||||||||||
| No further loan if default is made in repayment | |||||||||||||
| A Nidhi shall give loans to its members only against the following securities, namely:-
(a) gold, silver and jewellery: (b) immovable property (c) fixed deposit receipts, National Savings Certificates, other Government Securities and insurance policies |
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| Rule 16 | Rate of interest
No exceeding 7.5% above the highest rate of interest offered on deposits by Nidhi |
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Rule 17 |
Director shall be a member of Nidhi | ||||||||||||
| Director of a Nidhi shall hold office for a term up to 10 consecutive years | |||||||||||||
| shall be eligible for re-appointment only after the expiration of two years of ceasing to be a Director | |||||||||||||
| Rule 18 | Dividend not exceeding 25% or such higher amount as may be specifically approved by the Regional Director | ||||||||||||
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Rule 19 |
Individual Auditor not more than one term of five consecutive years | ||||||||||||
| audit firm as auditor for not more than two terms of five consecutive years | |||||||||||||
| eligible for subsequent appointment after the expiration of two years | |||||||||||||
| Rule 20 | Shall adhere to prudential norms | ||||||||||||
| Rule 21 | shall file half yearly return with the Registrar in Form NDH-3 within thirty days from the conclusion of each half year | ||||||||||||
| Rule 22 | A certificate from Auditor should be attached with the Audit report every year to the effect that company has complied with all the provisions contained in Nidhi Rules, 2014 | ||||||||||||
| KYC of Directors of the Company should be done | |||||||||||||
| Company should not have any default in filing of Form NDH-1, NDH-2 (if, applicable) and NDH-3 |
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