Más contenido relacionado


Nidhi Company - Registration & Operations

  1. Nidhi Company Registration & Operations
  2. Introduction In India, concept of Nidhi Companies has been set up way back in 20th Century where group of people came together with a purpose to resolve the monetary issues of people residing in a particular area or town so that they did not get prey on hands of moneylenders. It basically operates on principle of mutual benefits and also known as Permanent Fund, Benefit Funds, Mutual Benefit Funds and Mutual Benefit Company. Since then, Nidhi Company has gained popularity as a form of business. Main object of Nidhi Company is accepting money and promoting the habit of saving and growing value of money but activities of a Nidhi company are restricted to their members only. In India concept of Nidhi Company is mostly popular in southern part of India almost 80% of the Nidhi Companies are operational in South India. Since object of Nidhi Companies include accepting of deposits its functioning came under the ambit of Non-Banking Financial Companies it is also governed by Reserve Bank of India besides being regulated under Companies Act, 2013. 2
  3. As Legal Entity 3 Provisions of Nidhi Companies are regulated through Nidhi Rules 2014 (rules) of Companies Act, 2013 (Act). As per rule 3(da) Nidhi Company means: "A company which has been incorporated as a Nidhi with the object of cultivating the habit of thrift and saving amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit, and which complies with the rules made by the central Government for regulation of such class of companies. Thus Nidhi Companies shall: • have the object of cultivating the habit of thrift and saving amongst its members • receive deposits from, and lend to, its members only • all activities do be done for mutual benefit of members only
  4. As Legal Entity 4 Applicability of Nidhi Rules Nidhi Rules as given in the act are applicable to below given companies as per Rule 2 of the Rules: a. every company which had been declared as a Nidhi or Mutual Benefit Society under sub-section (1) of section 620A of the Companies Act, 1956; b. every company functioning on the lines of a Nidhi company or Mutual Benefit Society but has either not applied for or has applied for and is awaiting notification to be a Nidhi or Mutual Benefit Society under sub-section (1) of section 620A of the Companies Act, 1956; and c. every company incorporated as a Nidhi pursuant to the provisions of section 406 of the Act. d. every company declared as Nidhi or Mutual Benefit Society under sub-section of section 406 of the Act.
  5. Restrictions?? 5 As per rule 6 of the Rules there are some restriction or prohibition on working of Nidhi Company which are below given. Nidhi Company shall not: 1. Carry business of Chit Fund; 2. Issue preference share or any other debt instrument; 3. Open current account with members; 4. Carry on any business other than the business of borrowing or lending in its own name; 5. Accept deposits from or lend to any person, other than its members; 6. Pledge any of the assets lodged by its members as security; 7. Take deposits from or lend money to any body corporate; 8. Enter into any partnership arrangement in its borrowing or lending activities; 9. Issue or cause to be issued any advertisement in any form for soliciting deposit; 10. Pay any brokerage or incentive for mobilising deposits from members or for deployment of funds or for granting loans.
  6. Who can Become its Member 6 Rule 8 of the Rules states restriction of for membership of Nidhi Company as below: 1. Body corporate or trust cannot be member; 2. Minor cannot be Member ,bur deposit may be accepted in name of Minor through Legal Guardian who is member of Nidhi. Number of Membership should not be reduced to less than 200 members at any time.
  7. Opening of Branch Office 7 Since Nidhi Company involves interest of Members and expanding its area of operation beyond certain geographical limit creates monitoring issues for the authority, government has prescribed certain rules with respect to opening of branches by Nidhi Company under rule 10 of the Nidhi Rules. Nidhi Company can open 3 branches in DISTRICT To open more than 3 branches/outside DISTRICT: Reigonal Director approval required Cannot open branch outside state where Registered Office of Company is situated Pre Condition: Net profit after tax in preceeding three FY Annual Filing to be completed
  8. Who can become its Director 8 Besides being qualified to act as Director as per section 152 and 164 of the Act, provisions as given in Rule 17 should also be adhered: 1. Director shall be member of Nidhi Company; 2. Term should be 10 consecutive years; 3. Reappointment after cooling off of 2 year.
  9. Process for Incorporation 9 Persons willing to incorporate a Nidhi company must follow below given procedure 1. Apply for DSC of proposed members and directors of the Company, generally class 2 DSC serves the purpose for filing forms at the portal of MCA. 2. Ascertain name of the Company and check the availability of the same in accordance with section 4 of the Act and Rule 8 of the Companies (Incorporation) Rules 2014 and thereafter, file name application in PART A of web based form SPICE+, applicant can file two proposed name in this web based form, after approval of name, file incorporation documents again in PART B of web based form SPICE+ after selecting category of Company as “ NIDHI COMPANY” and Sub Category will automatically fill “PUBLIC LIMITED COMPANY” 3. Alternatively applicant can directly file name and incorporation application together in SPICE plus, by filing PART A and PART B simultaneously but it may be noted that through Spice Plus only one name can be applied and all documents of the Company to be filed in such proposed name. 4. Proposed directors of the Company can also apply for DIN in same form is they are not holding DIN prior to application. Maximum three directors can apply for DIN allotment at the time of application.
  10. Process for Incorporation 10 5. Applicants needs to submit below given documents with Spice plus • E- MOA & E-AOA in form INC- 33 & INC-34; • Proof for Registered Office; • Declarations in prescribed format; • Id and Address proof for subscribers and directors etc. 6. Spice plus will be submitted along with AGILE-PRO for application of GSTIN, EPFO,ESIC, Profession Tax, opening bank account. 7. After scrutiny by the CRC, in case of any deficiency the ROC may call for additional documents or clarification after providing a chance to resubmit form in 15 days, however if all the documents and details are appropriate than ROC will issue COI in form INC-11. 8. After incorporation, Company is require to file a declaration in form INC-20A within 180 days of incorporation. This declaration will state that that every subscriber to the MOA has paid the value of the shares agreed to be taken by him and Company has verified its Registered Office.
  11. Requirement post Incorporation 11 Rule 5 of Nidhi Rules states the requirement that a Nidhi Company should comply after its incorporation: Every Nidhi shall, within a period of one year from the date of its incorporation, ensure that it has: a. not less than two hundred members; b. Net Owned Funds of Rs. 10 lakh or more; c. unencumbered term deposits of not less than 10% of the outstanding deposits; d. ratio of Net Owned Funds to deposits of not more than 1:20.
  12. Thanks! Any questions? You can find me at +91-9311017074 12