1. Appointment at the Time of Incorporation

• A Nidhi Company must appoint at least three directors during incorporation.
  
• These initial directors are named in the Articles of Association (AOA) and the incorporation form (SPICe+).
  
• Each proposed director must submit consent using Form DIR-2.
  
• Digital Signature Certificate (DSC) and Director Identification Number (DIN) are mandatory.
  
• Their appointment is effective from the date of incorporation of the company.
  

2. Appointment by Shareholders in the General Meeting

• After incorporation, directors are appointed or reappointed by the members in a general meeting.
  
• The shareholders vote on resolutions for appointment during the Annual General Meeting (AGM).
  
• The directors serve according to the tenure and provisions set out in the company’s AOA.
  
• The appointment must follow the Companies Act, 2013, and Nidhi Rules, 2014.
  
• All changes must be filed with the Registrar of Companies through Form DIR-12.
  

3. Eligibility Criteria for Appointment

• Only members (shareholders) of the Nidhi Company are eligible to be appointed as directors.
  
• The person must hold equity shares and fulfill the director qualification norms.
  
• He or she must not be disqualified under Section 164 of the Companies Act.
  
• At least two-thirds of the board must be members who have held office for a minimum of 10 consecutive months.
  
• Age, residence, and legal compliance criteria must be satisfied.
  

4. Rotation and Reappointment Rules

• Directors are subject to retirement by rotation as per the Companies Act, unless exempted.
  
• Retiring directors may be reappointed at the discretion of the members.
  
• The maximum tenure for a director is 10 consecutive years, after which a 2-year cooling-off period applies.
  
• Regular rotation allows for transparency and fresh leadership.
  
• Reappointment must be recorded in meeting minutes and filed with the authorities.
  

5. Role of Board Resolutions and ROC Filings

• The Board of Directors must pass resolutions to propose or approve appointments.
  
• Consent to act and declarations must be obtained before the appointment.
  
• Each appointment or change must be reported through Form DIR-12 within 30 days.
  
• Registers such as the Register of Directors and Minutes Book must be updated.
  
• Adhering to proper appointment procedures ensures compliance and governance integrity.