No.
5/7/2000-CL.V
Government
of India
Ministry
of Law, Justice & Company Affairs
5th
floor, `A’ Wing, Shastri Bhavan,
Dr.
R.P. Road, New Delhi.
Dated: 13th September,
2001
PRESS
NOTE 5/2001
Subject: Issue of notification regarding norms/directions relating to Nidhi
companies.
The
Central Government by an order dated 23.3.2000 had set up a Committee of
experts under the chairmanship of
Sri P. Sabanayagam, IAS(Retired), former Chief Secretary of Tamilnadu, to
examine various aspects of
functioning of Nidhi companies. The said Committee had submitted its
report on 29.9.2000. Nidhi
companies even though of
special class of Non-Banking Financial Companies, are outside the regulatory framework of the
Reserve Bank of India. Owing to
minimum regulation of this sector, of late the Central Government has come
across many instances of default in repayment of
deposits to deposit holders of Nidhi companies.
2. The various recommendations made by the aforesaid Committee were
considered in consultation with Chambers, Federation of Benefit Funds, few notified nidhi companies, potential nidhi companies and also Reserve Bank of India. After thoroughly examining the recommendations made by the
Committee, Central Government has issued fresh set of guidelines/directions for
Nidhi companies/Mutual Benefit
Societies
superceding the
earlier notifications dated 1.11.1999, 19.11.1999 and 25.4.2000.
3. The two notifications
published in the Gazette cover all
the matters concerning
functioning and dynamics of
Nidhi companies.
4. A copy of
this Press Note has also been placed at the Web page of the Department of
Company Affairs at the Internet Address http://www.nic.in/dca.
(A.
Ramaswamy)
Joint
Secretary to the Govt. of India