Section 406 deals with Nidhi companies.
“Nidhi” means a company which has been incorporated as a Nidhi with the object of cultivating the habit of thrift and savings amongst its members, receiving deposits from, and lending to, its members only, for their mutual benefit, and which complies with such rules as are prescribed by the Central Government for regulation of such class of companies.
The Central Government may by notification direct any of the provision of this Act shall not apply of shall apply with some exceptions, modifications and adaptation specified in the notification to any Nidhi company.
A copy of every notification proposed to be issued shall be laid in draft before each House of Parliament for a total period of thirty days which may be comprised in one session or in two or more successions. If both House agree in disapproving the issue of the notification or both agree in making any modification in the notification, the notification shall not be issued or shall be issued only in modified form as agreed upon by both the Houses.
[UPDATE: An exemption notification was issued on 5th June 2015]
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