NDH-4 Declaration for a Nidhi Company: Deadline, Process and What Happens If You Miss It

Last updated 26 September 2026

What is the NDH-4 declaration and when must a new Nidhi company file it?

NDH-4 is the form a public company files with the Central Government to be declared a Nidhi under Section 406 of the Companies Act, 2013 and the Nidhi Rules, 2014. For a company incorporated on or after 19 April 2022, the deadline is 120 days from the date of incorporation, as of September 2026.

Say Lakshmi and eleven neighbours in a community savings group incorporate a public company on 1 March. Counting from the certificate of incorporation, her 120 days run out at the end of June. By that date she needs 200 members on the register and Net Owned Funds of ₹20 lakh, not just a plan to reach them. Net Owned Funds (NOF) is, broadly, paid-up equity capital plus free reserves, less accumulated losses and certain intangible assets; the rules also exclude the proceeds of preference share capital.

Two points catch people out. First, a Nidhi cannot commence business until the declaration is approved. Second, 120 days is short: incorporating the company is the easy part, and building a genuine 200-member base and the capital is the hard part. If you are still deciding whether a Nidhi is the right structure, read the Nidhi vs NBFC vs cooperative society comparison first.

What conditions must be met before you can file NDH-4?

You need four things in place before filing NDH-4: a public company on the MCA portal, at least 200 members, Net Owned Funds of ₹20 lakh or more, and a fit-and-proper declaration from every promoter and director. The table sets them out as of September 2026.

The ₹10 lakh paid-up capital and the ₹20 lakh NOF are money the company must hold, not fees anyone charges you. The Nidhi company requirements guide explains how members, NOF and the deposit ratios fit together.

Is the deadline 120 days or one year for NDH-4?

For companies incorporated on or after 19 April 2022, the deadline is 120 days, not one year. The "one year" figure comes from the pre-2022 regime and is still repeated on many blogs, including some that mix the old and new rules together.

Here is how the two regimes differ in plain terms:

• Incorporated on or after 19 April 2022: Rule 3B applies. NDH-4 within 120 days of incorporation, with 200 members and ₹20 lakh NOF. The old one-year conditions in Rule 5 are stated as not applicable to these companies.
• Incorporated before 19 April 2022: Rule 3B does not apply. Such companies follow the earlier rules (Rule 3A and the 2019 timelines), and the NOF figure they must reach is now ₹20 lakh as well, with a transition period the rules gave existing Nidhis.

If you are forming a new company today, you are in the first group. These rules come from the Nidhi (Amendment) Rules, 2022 (G.S.R. 301(E), 19 April 2022), as reported in the gazette text and secondary mirrors. As of September 2026 we found no later amendment that changes the 120-day rule, but rules can change, so your CA should re-check the current form and rule text before you file.

What is the fit-and-proper test for directors and promoters?

The fit-and-proper test is a signed declaration, by every promoter and director, that none of a listed set of disqualifying conditions applies to them. It is attached to Form NDH-4, so one problematic director can stall the whole application.

Under Rule 3B(3), a person is not treated as fit and proper if, among other grounds:

• a criminal complaint filed by a person authorised by the Central Government is pending, or a charge sheet for an economic offence is pending;
• a restraint or debarment order under company law, securities law or financial-market law is in force;
• they have been convicted of an offence involving moral turpitude;
• they are an undischarged insolvent, or have been found to be of unsound mind;
• they are a wilful defaulter or a fugitive economic offender;
• they are a director in five or more Nidhi companies, or a promoter of three or more.

Check every proposed director and promoter against this list before incorporation, not after. Replacing a director in month three costs you days out of a 120-day window. Your CA can review the list against each person's background when you speak on the free callback.

What are the steps to file NDH-4 and get declared a Nidhi?

The route runs from incorporation to Official Gazette declaration in six steps, and only the last step lets you start lending and taking deposits. The Central Government has 45 days to decide, and silence counts as approval.

1. Incorporate a public company. The company is formed on the MCA portal through SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus). This is the step covered by Shunya's Nidhi company registration.
2. Build the base. Admit at least 200 members and bring Net Owned Funds to ₹20 lakh or more.
3. Collect declarations. Every promoter and director signs the fit-and-proper declaration.
4. File NDH-4 within 120 days. The application goes to the Central Government on the MCA portal, with the attachments the current form requires.
5. Wait for the decision. Rule 3B(4) gives the Central Government 45 days. If no decision is conveyed in that period, the application is deemed approved. The rule does not say how long an officer query pauses that period, so ask your CA.
6. Declaration and Form 20A. The approval is notified in the Official Gazette. The company then files the approval with the Registrar along with Form 20A (INC-20A) and may commence business.

On paper, that is up to roughly 165 days from incorporation to approval (120 plus 45). We did not find an official average for how long approvals actually take, so treat any promised NDH-4 timeline from a service provider with caution. The process and timeline guide lays out the stages in more detail.

The government fee for NDH-4 is not something we can state reliably: figures quoted online vary, so your CA confirms it before you pay.

What happens if you miss the NDH-4 deadline or the application is rejected?

A company that does not comply with the NDH-4 requirement cannot file Form SH-7 (alteration of share capital) or Form PAS-3 (return of allotment), and it cannot operate as a Nidhi. Those two forms are how a company raises fresh capital, so a missed deadline freezes your ability to grow the paid-up base.

The rules also treat a rejected or non-compliant application seriously. In the gazette text, once an NDH-4 is rejected or the company fails to comply, it cannot raise deposits from members or lend to members under the Nidhi Rules from that date, and deposits raised afterwards are treated under the ordinary public-deposit provisions of Chapter V of the Act. That is a very different, heavier regime. Wording varies between the rule versions, so confirm exactly how it applies to you with your CA.

Rule 3B contains no extension clause in the text we read. Whether the Regional Director will entertain an application for more time is not something we could verify, so do not plan around one.

Can you file NDH-4 yourself, or should a CA do it?

You can file NDH-4 yourself if you hold valid DSCs, have your member register and NOF evidence in order, and are comfortable answering an officer's query. A CA becomes worth paying for when you have a tight 120-day window and cannot afford a rejected or returned application.

Here is what Shunya's live Nidhi page describes: a CA verifies documents, checks name availability, obtains DSC and DIN for directors, prepares SPICe+ with Nidhi-compliant MOA and AOA, files it with AGILE-PRO-S for PAN and TAN, and handles officer queries on your behalf. Shunya's professional fee for that is ₹1,999. It does not include the DSC issuer's charge, government fees or other statutory costs, which are billed separately; your CA walks you through them on your callback.

The page does not list the NDH-4 application itself as part of that package. If you want a CA to handle NDH-4 after incorporation, ask on the callback and get the scope confirmed in writing. A practising Chartered Accountant reviews every filing Shunya handles. The Nidhi package guide lists exactly what is and is not on the page.

This article is for general information only. For your specific situation, consult a practicing CA.