In accordance with the Section 406 of the Companies Act, 2013 and the rules made thereunder, a “Nidhi Company” means a company incorporated as a Nidhi along with the object of –
-Cultivating the habit of thrift and savings amongst the members, and
-Receiving deposits from and lending to the members for their mutual benefit, and also duly complying with the rules formed by the Central Government.
In the recent blogs, we have discussed about the incorporation, post incorporation compliances of the Nidhi Company which can be accessed under https://taxguru.in/author/kajalgoyal08/. Further, under this article, we shall study about the important contents of application form that should be prepared by a Nidhi Company for accepting deposits.
APPLICABLE ACT AND RULES: Section 406 read with Rule 6 of the Nidhi Rules, 2014
CONTENTS OF APPLICATION FORM FOR ACCEPTING DEPOSITS:
Every membership application form for placing deposits with a Nidhi shall contain the following particulars, namely: –
1. Name and date of incorporation of Nidhi
2. The business carried on by Nidhi along with details of branches, if any
3. The information of various heads mentioned in the below table shall also be part of the application form: –
| S. No. | Particulars | Information to be mentioned |
| 1. | Management information of Nidhi Company | Name, address, occupation of director with their DINs |
| 2. | Net profits Details | Amount before and after making provision for tax for the preceding three financial years. |
| 3. | Dividend Details | Dividend declared during the preceding three financial years. |
| 4. | Deposit Details |
|
| 5. | Summary on the financials of the Company
(As per the latest two audited financial statements) |
|
The application form for accepting deposits shall also contain the following statements: –
- That in case of non-payment of the deposit or part thereof as per the terms and conditions by the Nidhi Company, the depositor may approach the Bench of the NCLT having jurisdiction over Nidhi.
- That in case of any deficiency of Nidhi in servicing its depositors, they may approach the Redressal Forum, as the case may be, for redressal of his relief depending on the quantum of claim.
- That the declarations made by the Board of Directors of Nidhi as disclosed and the representations made in the application form are true and correct and the deposits accepted by Nidhi are not insured and the repayment of deposits is not guaranteed by either the Central Government or the RBI.
- A verification clause by the depositor stating that he has read and understood the financial and other particulars furnished and representations made by Nidhi in his application form and after careful consideration he is making the deposit with Nidhi at his own risk and volition.
The aforementioned details are the mandatory requirements as per the rules however, the basic details of the depositor shall also be obtained like the personal details (eg: photo, name, father’s/husband’s name, permanent and correspondence details, marital status, etc.), nominee details, bank details, etc. along with the following documentary evidence as a proof:
Proof of Identity (any one of the following):
Passport/Unique Identification Number (eg: Aadhar card)/PAN card/Voter ID Card/Driving license/Ration card
Proof of address (any one of the following)
Passport/Unique Identification Number (eg: Aadhar card)/ Voter ID Card/Driving license/Ration card/Telephone or Electricity bill/Bank statement
It is pertinent to note that the electricity or telephone bill or bank statement shall not be older than two months.
However, for giving loans, no particular format of application form is given but still, it is recommended to get the same drafted in consonance with the generally accepted principles and peer Nidhi Companies.
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(The author i.e., Kajal Goyal is a Company Secretary in Practice at M/s. Kajal Goyal and Associates and can be reached at (M) +91-9999952595 and (E) cskajalgoyal@gmail.com)
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