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TMI BlogPrudential Norms for NidhisX X X X Extracts X X X X X X X X Extracts X X X X ..... ction (1) of section 637 A of the Companies Act, 1956 (1 of 1956), the Central Government hereby directs that :- 1. Every company declared as a Nidhi or Mutual Benefit Society under section 620A of the Companies Act, (hereinafter referred to as such Nidhi or Mutual Benefit Society) after the publication of this notification shall adhere to the following prudential norms for revenue recognitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alue of the collateral security to which such Nidhi or the mutual benefit society has valid recourse may be reduced from the aggregate outstanding amount if the proceedings for sale of mortgaged property have been initiated in a court of law within the previous two years of the interest, income or instalment remaining unrealised. In no case the value of collateral security would be more than the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egotiation or rephasement ; (3) "Doubtful Asset" will be those borrowal account which remained non-performing for more than one year but upto two years. (4) "Loss Asset" will be that borrowal account which remained non-performing for more than two years or where the documents executed may become invalid if subjected to legal processes, as per the opinion of the Nidhi, or its internal audit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent by the borrowers and make 100 percent provision to the extent of unrealised amount being the deficit in the current years profit and loss account. 2. The above prudential norms for revenue recognition and classification of assets shall be applicable to all Nidhi companies notified under section 620 A of the Companies Act, 1956 before or after the publication of this notification and t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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