Legal & Compliance
The rate of interest to be charged on any loan shall not exceed 7.5 % above the highest rate of interest offered on deposits by Nidhi and shall be calculated on reducing balance method.
Dividend: A Nidhi shall not declare dividend exceeding 25 % or
Director:
Auditor:
Such higher amount as may be specifically approved by the Regional Director for reasons to be recorded in wri ng and further subject to the following condi ons- An equal amount is transferred to General Reserve; There has been no default in repayment of matured deposits and interest; and It has completed with all the rules as applicable to Nidhis.
The director shall be a MEMBER of Nidhi. He shall hold office for a term up to 10 consecu ve years on the Board. He shall be eligible for re-appointment only a er the expira on of 2 years ceasing to be a director. Where the tenure of any director in any case had already been extended by the Central Government it shall terminate on expiry of such extended tenure. The person to be appointed as a Director shall comply with the requirements of Sec on 152( 4) of the Act and shall not have been disqualified as provided in Sec on 164 of the Act.
The tenure of Auditor is five consecu ve years. No auditor or audit firm as auditor shall be appointed for more than two terms of five consecu ve years.
Branches:
The auditor shall be eligible for subsequent appointment a er the expira on of two years from the comple on of his term. The Auditor of the company shall furnish a Cer ficate every year to the effect that the company has complied with all the provision contained in the rules and such cer ficates shall be annexed to the audit report and in case of non-compliance he shall specifically state the rules which have not been complied with.
A Nidhi may open branches only if it has earned net profits a er tax con nuously during the preceding three financial years. The company may open up to 3 branches only within the district. If it proposes to open more than 3 branches within the district or any branch outside the district, it shall obtain prior permission of the Regional Director and in ma on is to be given to the Registrar about opening of every branch within 30 days of such opening. No Nidhi shall open branches or collec on centers or offices or deposit centers, or by whatever name called outside the State where its registered office is situated. Further branches or collec on centers or offices or deposit centers shall be opened unless financial statement and annual return are filed with the Registrar.
www. Venture-Care. com / Magazine October 2017
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