Nihalani had reportedly been unwell for the past four months and was undergoing treatment at Mumbai's Nanavati Hospital.
His last rites will be performed at 3 pm at the Santacruz Crematorium.
He is survived by his wife Nita and three sons.
Bollywood Producer Behind Several Hits
Nihalani was a prominent name in the Hindi film industry and produced several successful films, including Aankhen, Shola Aur Shabnam and Ilzaam.
Over a career spanning several decades, he established himself as a notable producer and distributor in Bollywood.
Controversial Tenure as CBFC Chairman
Nihalani is perhaps best remembered for his tenure as chairman of the Central Board of Film Certification between 2015 and 2017.
His strict approach to film certification made him one of the most controversial CBFC chiefs in recent history.
During his tenure:
- Several films were asked to undergo extensive cuts before release.
- He faced criticism from filmmakers and artists over allegations of excessive censorship and moral policing.
- CBFC decisions on films such as Udta Punjab and Lipstick Under My Burkha triggered nationwide debates on artistic freedom and censorship.
Removed from CBFC in 2017
In August 2017, the Government of India replaced Nihalani as CBFC chairman with lyricist and advertising professional Prasoon Joshi.
Following his exit from the censor board, Nihalani remained active in the film industry and continued to comment on issues related to cinema and film certification.