Amendments in Notification No. GSR 555(E), dated 26-7-2001- Nidhis - Power to modify Act in its application to - GSR 202(E). - Companies Law

MINISTRY OF COMPANY AFFAIRS NOTIFICATION New Delhi, the 31 st March 206 Subject:- Amendments in Notification No. GSR 555(E), dated 26-7-2001- Nidhis - Power to modify Act in its application to GSR 202(E).- In exercise of the powers conferred by sub-section (1) of section 637A of the Companies Act, 1956 (1 of 1956), the Central Government hereby makes the following further amendments in the Notification of the Government of India, the erstwhile Ministry of Law, Justice and Company Affairs (Department of Company Affairs) No. G.S.R. 555(E), dated 26-7-2001, published in the Gazette of India, in Part II, section 3, sub-section ( i ), dated the 26th July, 2001, namely: In the said notification, in clause (1),- ( i ) in sub-clause ( a ), in item ( vii ), the following provisos shall be inserted, namely: Provided that those Nidhi companies which have adhered to all the provisions of the notification may undertake the business as insurance brokers, locker providers and to provide advisory services to members with the prior approval of the Regulatory authority subject to any other law in force in this regard : Provided further that their gross income from mortgage and jewel loan shall not fall below 80 per cent of gross income at any point of time during a financial year; ( ii ) in sub-clause ( d ), in item ( i ), in the first proviso, for the table, the following shall be substituted, namely: TABLE Ratio of Net Owned Fund to Deposits (as on 31-3-2001) Date by which the company was required to achieve the prescribed ceiling of 1 : 20 Extended date by which the Company has to achieve the prescribed ceiling of 1 : 20 ( a ) More than 1 : 20 but up to 1 : 25 By 31-3-2004 By 31-3-2007 ( b ) More than 1 : 25 but up to 1 : 40 By 31-3-2005 By 31-3-2007 ( c ) More than 1 : 40 but up to 1 : 80 By 31-3-2006 By 31-3-2007 ( d ) More than 1 : 80 and above By 31-3-2007 By 31-3-2007 ( iii ) in sub-clause ( e ), in item ( c ), the following explanation shall be inserted, namely: Explanation. Introduction and documentary evidence of new depositors shall include all criteria applicable to know your customer norms prescribed by Reserve Bank of India before accepting deposits by non-banking finance companies ; ( iv ) in sub-clause ( g ) after the words a regional rural bank , the following words shall be inserted; namely: or post office deposits in the name of the Nidhi company and not in the name of individuals ; ( v ) in sub-clause ( h ), in item ( ii ), for the words seven and half per cent the words five per cent shall be substituted; ( vi ) in sub-clause ( i ), ( a ) in item ( i ), for sub-item (A), the following shall be substituted, namely:- (A) have any person as director for a continuous period of more than ten years; Explanation . any break in continuous service as director of less than two years would be construed as holding office continuously: Provided that where the tenure of any director was already extended by Regulatory Authority, it shall terminate on expiry of such extended tenure . ( b ) in para ( iii ), in the proviso, after the words interest thereon the following words shall be inserted: if the company has not made provision in accordance with the regulations including the time schedule and/or the company has not achieved the prescribed ratio of net owned fund to deposits. ( c ) after item ( vi ), the following item shall be inserted, namely: ( vii ) no person or firm appointed as statutory auditors of the company for a continuous period of five years, shall be reappointed as statutory auditor. Explanation . Firm includes any partner of the same firm or any associate of the same firm either in that capacity or in any other individual capacity. ;