Allotment of DIN
The Director Identification Number (DIN) is the cornerstone of corporate governance in India. Mandated under the Companies Act 2006, this unique eight-digit number is required for every individual who aspires to or currently holds a directorship in a company.
It serves as a personal identifier, linking directors to their roles across multiple companies. By centralizing director information, DIN enhances transparency, accountability, and regulatory oversight within the corporate landscape. The system plays a vital role in maintaining the integrity of company management and protecting the interests of stakeholders.
This article by Blacktie Legal Services India LLP highlights the intricacies of DIN allotment, its importance, eligibility criteria, and the step-by-step process involved in obtaining it.
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Understanding Director Identification Number (DIN)
DIN or Director Identification Number is a number allotted to each director based on their Permanent Account Number with the Income Tax Department and has been made mandatory for all existing and prospective directors in India.
It is an 8-digit alpha-numeric number assigned by the Ministry of Corporate Affairs (MCA) to individuals who wish to be appointed as directors. The primary function of the DIN is to maintain a register of directors and ensure that people who have resigned as directors or who have been barred from being directors cannot evade regulators by registering new companies.
In essence, the Director Identification Number (DIN) is not just a mandatory requirement for individuals aspiring to hold directorial positions in Indian companies, but also a cornerstone of corporate governance, enhancing transparency and regulatory oversight in the corporate sector.
Importance of DIN
Unique Identification: DIN is also a kind to director identification number that provide a separate unique number of each director through which all companies link with that director.
- Transparency and Accountability: Indirectly, DIN provides high protection to the corporate sector by collecting and keeping a check on all the directors in a central database. It assists the legal bodies in supervising and putting into record the activities of directors in various organizations.
- Prevents Misrepresentation: DIN assists in avoiding situations related with directors’ misconduct or disqualification that allows them perform as directors of new businesses, thus protecting the shareholders and stakeholders’ interests.
- Legal Requirement: According to the Companies Act, 2013 everyone who plans to become a director of a company is required to have a DIN. Here it should be stated that whenever the appointment of a director has been made without a valid DIN it cannot be considered as a legal appointment.
Eligibility Criteria of DIN Allotment
To apply for DIN, every person who wants to become a director has to fulfill some specific criteria. Which we have mentioned below in a reasonable manner:
- Age: The applicant must be at least 18 years old. However, there are no restrictions as to the maximum age a person can be to obtain a DIN.
- Nationality: Indian nationalities and foreign nationalities both can apply for a DIN. However, the above procedure may slightly differ depending on the fact whether the applicants are foreign or not.
- Documentation: The applicant must produce identification and proof of his/her address in the form of a passport, voter ID, driver’s license, Aadhar card for the Indian nationals and passport for any foreign national.
- Digital Signature Certificate (DSC): It is mandatory for the applicant to have a Digital Signature Certificate (DSC) from any of the certifying authorities in India. One of the documents that need to be filled by the DSC is the DIN application form, and the form needs to be digitally signed as well.
Step-by-Step Procedure for Allotment of DIN
There are many critical aspects involved in the process of allotment of DIN, which we have explained step by step below:
Step 1: Obtain a Digital Signature Certificate (DSC)
It is essential to have a digital signature certificate on our individual before applying for DIN because DSC is used for DIN application and all other documents part digital signature and it can be very easily achieved by the authority through MCA.
Step 2: Access the DIN Application Form (DIR-3)
The next step is to go through the online DIN application form, DIR-3, available on the website of the Ministry of Corporate Affairs. The said form can be accessed from the MCA’s website and should be completed with the correct details.
Step 3: Filling Out the Application Form
An applicant has to submit DIR-3 form which contains basic information about the applicant such as his/ her name, father’s name, date of birth, his/ her address and education details. The form also has sections for the applicant’s contact information and the proposed company, in which the applicant wishes to be appointed as a director.
Step 4: Attach Supporting Documents
At the same time with DIR-3 form, the applicant has to provide the certified true copies of the documents pertaining to proof of identity, proof of address and photograph. The papers should also be attested by the applicant using their knowledge and under their signature.
Step 5: Certification by a Professional
DIR-3 form and necessary documents need to be certified by any practicing professional that can be Chartered Accountant, Company Secretary, or Cost Accountant. The certifying professional must also sign in the form, affirming to the correctness of the information recorded.
Step 6: Submission of Application
After completing the form, the form has to be signed and certified after which the information can be submitted online at the MCA website. The applicant also has to sign the form using the DSC before the submission of the form.
Step 7: Verification and Approval
After the submission of the application and payment of fees, the MCA checks, and authenticates the information submitted. In case the application is found to be in order, the DIN is allotted in less than a week and the applicant is intimated through email.
Post - Allotment Compliance of DIN
Once the DIN is allotted, the applicant must ensure that it fulfills specific requirements to ensure its validity and use, which we have mentioned below:
- Intimation to Company: The applicant will have to inform the company where he has been allotted the post of director within 30 days of the first allotment, after that the company will have to inform the ROC about the director’s DIN within 15 days.
- Updating DIN Details: If there are changes in the personal details of the individual director, like name, address, etc., then the director himself has to visit the MCA portal, fill out the DIN form, and update the DIR records. All the documents should be attached to the form and should be attested by a professional.
- Annual KYC Compliance: All Directors are also expected to undergo KYC compliance every year where they filing Form DIR-3 KYC to the MCA. The form must be filed before the due date set annually for the prevention of deactivation on the DIN.
- Director’s Disqualification: If a director is disqualified due to the provisions of the Companies Act, 2013, his/ her DIN is also gets deactivated. Any appointments to such disqualified directors as directors in any company is unlawful and any such appointment would be deemed to be nugatory.
Conclusion
The Director Identification Number (DIN) is one of the significant corporate measures that enhance the company’s compliance with the regulatory authority in the appointment process of directors. DIN is of significant value, which is why Blacktie Legal Services India LLP is well-equipped to help anyone in getting DIN and offer sufficient guidance to the concerned party.
Whether the user is a new director who wants to apply for the first DIN or an accomplished director who wants to make changes to their DIN details, we are always here to help you. With our knowledge and skills, DIN allotment service will not become any stress or problem to you which will allow you to concentrate on your business strategies.
What we can offer ?
Blacktie legal services India LLP is specializing in corporate law and compliance can offer comprehensive services to facilitate the allotment of Director Identification Numbers (DINs) for individuals seeking to become directors of companies. Here are the specific services that a legal firm can provide in relation to DIN allotment:
- Consultation and Advisory Services:
- – Preparation and Review: Assist individuals in preparing Form DIR-3 accurately, ensuring all required details and supporting documents are in order.
- – Legal Advice: Provide legal guidance on eligibility criteria, documentation requirements, and compliance with relevant laws and regulations.
- Application Filing and Processing:
- – Online Filing: Handle the online submission of Form DIR-3 through the Ministry of Corporate Affairs (MCA) portal.
- – Document Verification: Verify and ensure all necessary supporting documents (such as proof of identity, residence, PAN card, etc.) are correctly attached and meet regulatory standards.
- Certification and Sign-off:
- – Certification: Arrange for the certification of Form DIR-3 by a practicing Chartered Accountant, Company Secretary, or Cost Accountant as required by MCA guidelines.
- – Digital Signatures: Provide digital signatures for the application submission, ensuring compliance with electronic filing requirements.
- Follow-up and Coordination:
- – Monitoring Progress: Track the status of the DIN application, follow up with the MCA on behalf of the client, and manage any queries or requests for additional information.
- – Timely Responses: Ensure prompt responses to any office actions or queries raised by the MCA during the processing of the application.
- Compliance and Regulatory Updates:
- – Stay Updated: Keep clients informed about any changes in DIN allotment procedures, regulations, or compliance requirements.
- – Training and Awareness: Offer workshops or training sessions to educate clients on maintaining compliance with DIN-related regulations.
- Documentation and Record-Keeping:
- – Maintain Records: Assist in maintaining proper records of DIN allotments, including issuance certificates and relevant documentation.
- – Document Retention: Ensure that all documentation related to the DIN application process is securely retained and readily accessible as per legal requirements.
- Post-Allotment Services:
- – Advice on Responsibilities: Provide guidance on the responsibilities and obligations of directors under the Companies Act, helping newly appointed directors understand their roles and duties.
- – Ongoing Support: Offer ongoing legal support and advice related to corporate governance, compliance, and regulatory matters affecting directors.
By offering these services, Blacktie legal services can streamline the process of DIN allotment for individuals aspiring to take up directorship roles in Indian companies. They ensure compliance with regulatory requirements while providing expert guidance and support throughout the application process and beyond.