The best way to edit /etc/passwd, or shadow or group file is to use vipw command. Traditionally (under UNIX and Linux) if you use vi to edit /etc/passwd file and same time a user try to change a password while root editing file, then the user’s change will not entered into file.

Can I modify etc passwd?

There is no such command to apply changes from /etc/passwd file. If user which details you’ve changed is logged in, it should just relogin to apply the changes.

Can I edit ETC Group?

The vipw and vigr commands are used to safely edit the files /etc/passwd and /etc/group in Linux systems. They will put appropriate locks when editing /etc/passwd and /etc/group files to prevent other users from making any changes in them and avoid file corruption.