Alok Nidhi Ltd., a Nidhi Company, desires to appoint M as the Director of the company. M has been convicted of an offence involving moral turpitude and sentenced to imprisonment for a period of six months, 4 years ago. A

Rules relating to directors of Nidhi Company have been given in Rule 17 of Nidhi Rules 2014. As per Rule 17(5), the person to be appointed as director shall comply with requirements of Sub-section (4) of Section 152 of the Companies Act, 2013 and shall not have been disqualified from appointment as provided in Section 164 of the Companies Act, 2013. As per Section 164(1)(d) of the Companies Act, 2013, a person shall not be eligible for appointment as a director of a company if such person has been convicted by a court of any offence, whether involving moral turpitude or otherwise, and sentenced in respect thereof to imprisonment for not less than six months and a period of five years has not elapsed from the date of expiry of the sentence. Provided that if a person has been convicted of any offence and sentenced in respect thereof to imprisonment for a period of seven years or more, he shall not be eligible to be appointed as a director in any company. Since M has been convicted of an offence involving moral turpitude and sentenced to imprisonment for a period of six months and a period of five years has not elapsed from the date of expiry of the sentence, M is not eligible for appointment as director of Alok Nidhi Ltd.