NDH-4 Approval in 45 Days - All About Nidhi (Amendment) Rules, 2022

If you are running a Nidhi Company or planning to open a Nidhi Company and not sure about the NDH-4 will get approval or not and already frustrated with the amount of compliance you face, we have some good news for you.

The government of India after certain recommendations from committee formed for Nidhi Company working has amended the original Nidhi rules 2014 as amended by Nidhi (amendment) rules 2019 and come up with Nidhi (amendment) Rules 2022.

With new rules, the government try to simplify the things to get Nidhi company get themselves declared as Nidhi Company by getting their NDH4 Approved within stringent timelines specified by these rules.

Government wants to safeguard the interest of general public, and wants that before becoming  member of Nidhi company, one must ensure declaration of a company as a Nidhi by the Central Government and towards this, few necessary/important amendments in the Rules have been carried out which are applicable to the Companies to be incorporated after Nidhi (amendment) Rule, 2022.

• Nidhi Company needs to File NDH-4 - Within 4 months (120 days) from the date of its incorporation.
   
• Requirements before filing NDH-4 :
   
  • Nidhi must have minimum 200 Members and the Net Owned Fund (NOF) is not less than 20 Lakh.
  • The Promoters and Directors of the company must meet the criteria of fit and proper person as laid down in the rules.
     
• Nidhi company can commence its business only after getting approval of NDH-4 by filing form 20A.
   
• It is mandatory for government to approve NDH-4 within 45 days of filing, if government has not provided any revert or any approval then NDH-4 will be deemed as approved.
   
• Form 20A needs to be filed after you get approval of NDH-4 that means before NDH-4 approval you are not allowed to commence the business of Nidhi.
   
• Filings of NDH-1 and NDH-2 are not applicable for companies incorporated after commencement of these rules.
   
• For Existing companies before commencement of these amendment rules, Minimum Capital for Nidhi company is 10 lakhs, this condition needs to be fulfilled in 18 months from the date of commencement of these rules.
   
• No Nidhi Shall raise loans from bank or any financial institution - for advancing loan to its members.
   
• A member shall not transfer more than fifty percent of his shareholding (as on the date of availing of loan or making of deposit) during the subsistence of such loan or deposit.
   
• Net Owned Fund (NOF) limit should be 20 lakh and to be fulfilled within 120 days (4 months) of Incorporation for New companies and for existing Nidhi’s companies this rule is relaxed and those companies will have the time limit of 18 months from the date of commencement of these rules to maintain this NOF limit.
   
• To Open New Nidhi Branches - Nidhi can apply for branches to Regional Director (RD) in form NDH-2 as per the Specified rules.
   
• For closure of Nidhi Branches - Nidhi needs to apply to RD in NDH 2 at least 60 days before plan closure and plan needs to be approved in board meeting and needs to apply in NDH-5 format which needs to be given in Newspaper and NDH-2 also needs to be filed in specified period mention in rules.
   
•  Any place, not being a registered office or a branch, where a Nidhi carries on its operation shall be closed within a period of six months from the date of commencement of the Nidhi (Amendment) Rules,2022 and intimation shall be sent to the Registrar in this regard in Form NDH-2.
   
• Loan against Silver can also be disbursed to members of Nidhi.
   
• In case of unforeseen commitments, temporary withdrawal may be permitted with the prior approval of the Regional Director by filing the same in NDH-2.

These amendments must require amendments done by the ministry in relation to Nidhi companies. As before these rules, most of the Professionals or companies does not know how to reach Regional Directors for Branch approvals or for NDH-4 Filings. We have tried to give the information around Nidhi (Amendment) Rules 2022 in a brief manner, in case of more information required you may reach us to info@hubco.in or you can mention your question in the comment box below.