Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More



What is Digital Signature Certificate (DSC) ?


A digital signature is to electronic documents what a handwritten signature is to printed documents. A digital signature is an electronic signature that can be used to authenticate the identity of the sender of a message or the signer of a document.

Like physical documents are signed manually, electronic documents, for example e-forms are required to be signed digitally using a Digital Signature Certificate.


Why DSC ?

The Information Technology Act, 2000 provides for the use of Digital Signatures on the documents submitted in electronic form in order to ensure the security and authenticity of the documents. Digital Certificates are issued only through a valid Certification Authority (CA).

Digital signatures are often used to implement electronic signatures, a broader term that refers to any electronic data that carries the intent of a signature, but not all electronic signatures use digital signatures. In some countries, including the United States, India, and members of the European Union, electronic signatures have legal significance.

Types of Digital Signature Certificate

Class 1: These certificates do not hold any legal validity as the validation process is based only on a valid e-mail ID and involves no direct verification.

Class 2: Here, the identity of a person is verified against a trusted, pre-verified database.

Class 3: This is the highest level where the person needs to present himself or herself in front of a Registration Authority (RA) and prove his/ her identity. 

Issuance and uses


A digital signature is issued by a Certification Authority (CA) and is signed with the CA's private key. A digital signature typically contains the: Owner's public key, the Owner's name, Expiration date of the public key, the Name of the issuer (the CA that issued the Digital ID), Serial number of the digital signature, and the digital signature of the issuer. Digital signatures deploy the Public Key Infrastructure (PKI) technology.


A Digital Certificate provides an electronic means of proving your identity. It also provides you with a high level of security for your online transactions. You can use certificates to encrypt information such that only the intended recipient can read it. You can digitally sign information to provide assurance to the recipient that it has not been changed in transit, and enable verification that you actually sent the message


If you file electronically using digital signature you do not have to submit a physical copy of the return. Even if you do not have a digital signature, you can still e-File the returns. However, you must also physically submit the printed copy of the filled up Form along with the copy of the Provisional Acknowledgement Number of your e-Return


Indias position in deploying DSCs


India is one of the select band of nations that has the Digital Signature Legislation in place. This Act grants digital signatures that have been issued by a licensed Certifying Authority in India the same status as a physical signature. Digital signatures deploy the Public Key Infrastructure (PKI) technology.



If one is not having a Digital Signature. Does this mean he/she cannot file online?

In case you do not have a Digital Signature, you can still e-File the returns. However, you must also physically submit the printed copy of the filled up Form along with the copy of the Provisional Acknowledgement Number of your e-Return.



Where can one get a digital signature made?


The Information Technology Act, 2000 provides for use of Digital Signatures on the documents submitted in electronic form in order to ensure the security and authenticity of the documents filed electronically. Certification Agencies are appointed by the office of the Controller of Certification Agencies (CCA) under the provisions of IT Act, 2000. There are a total of seven Certification Agencies authorised by the CCA to issue the Digital Signature Certificates.


Name of Certifying Agency


Tata Consultancy Services Ltd.

National Informatics Centre

Institute for Development & Research in Banking Technology (IDRBT)


Customs & Central Excise

(n)Code Solutions Ltd., (A division of Gujarat Narmada Valley Fertilisers Company Ltd.)


e-Mudhra CA



What is Pan encrypted Digital signature certificate ?


 Digital signature certificate issued after 1st of August 2010 will be pan encypted and As per Income tax notification only pan encrypted DSC will be accepted for e-fling your tax return

What are the benefits of using Digital Signatures to sign the electronic documents?

The Digital Signatures have various advantages over the handwritten signatures. The digital signatures allow conversion of processes and transactions to electronic mode thereby reducing time, costs and efforts required for creating and maintaining physical records. More importantly the Digital Signatures are used for maintaining data integrity, as the messages or documents cannot be changed after signing. They also provide authentication, i.e. the receiver of a document or communication is assured of the signer authenticity.



Are the Digital Signatures as legally valid as the handwritten signatures?

If any changes are made to the electronically signed documents, it immediately invalidates the signature. Digital Signatures can be used to authenticate the source of messages, i.e. to assure the receiver that the message has been sent by the authorized source only as it protects the electronic document from forgery.

Act Governing the Dsc s

IT Act 2000 : The Indian Information Technology Act 2000 (Act) came into effect from October 17, 2000. The Act is by and large based on the United Nations Commission on International Trade Law (UNCITRAL) model law on electronic commerce.

The objective of the Act is to provide for legal recognition of electronic transactions and digital signatures. Section 5 of the Act gives legal recognition to digital signatures. Digital signatures have been legalised in India since 2000. However, since then, hardly any provisions of the Act have been implemented, except for the appointment of the Certifying Authority which took place in 2001


Fraud prevention: By using digital signatures we are eliminating the possibility of committing fraud as the digital signature cannot be altered. Moreover the forging signature is impossible.

Message integrity: By having a digital signature we are in fact proving the document to be valid. We are assuring the recipient that the document is free from forgery or false information.

Legal requirements: Using a digital signature satisfies some type of legal requirement for the document in question. A digital signature takes care of any formal legal aspect of executing the document.

Online Banking Advantages : Many businesses rely on digital certificates for banking procedures. For example, a human services organization that distributes customer incentive checks uses a digital certificate to validate each instrument. Each time a check is created, a designated user employs an identifiable computer to upload and manage each check prior to distribution. This alerts the bank of the amount and number of each check. In addition, the digital certificate protects against fraudulent activity by assuring the party receiving the information you are not an impostor. Online banking would not be possible without the use of digital certificates. According to Bank of America, transactions cannot take place until the digital certificate has been verified.


Legal Advantages : Digital certificates and signatures provide protection in legally binding situations. When sending email to a bank, for example, a digital signature will verify that the information came from you. When agreeing to legally binding requirements, digital certificates prevent you from becoming a victim of an impostor. In addition, digital certificates and signatures prevent the recipient from denying the receipt of information.

Financial Disadvantages : Businesses must purchase digital certificates from certification authorities. A certificate authority acts as a third-party issuer that ensures the acceptance of the certificate. Certification authorities typically require a subscription to their service, which requires monthly payments to continue the relationship. In addition, multiple certificates for different sites or purposes can become a costly endeavor.


Technological Disadvantages : When considering digital certificates, you need to factor in many areas of existing technology. According to The Institute of Internal Auditors, "auditors should recommend that senior and IT managers consider the tool's ease of use, integration with the existing software platform, the company's product architecture, the security of the tool (e.g., the strength of the algorithm used), vendor support, cost, and future flexibility before deciding which tool to implement." In addition, creating a platform that accepts all digital certificates is a difficult undertaking, and human carelessness may compromise the safety of login credentials.

Equipment Cost : Electronic signatures are created and read by sophisticated technologies that use networks to verify personal data like business location or social security numbers, or which are advanced enough to compare points within handwriting or a fingerprint with points in images in databases. This equipment isn't always cheap, as pointed out by Beginners Guide. Even once initial costs are met, advances in electronic signature technology will mean that a business must continually update its electronic signature systems and provide technical support.


Deterred Clients : Electronic signature systems assume that people will be comfortable or familiar with the electronic signature methods and equipment. However, previous generations of individuals may not have been exposed to the newer technology and thus may have trouble initially using it. Even tech-savvy individuals still will have to stay abreast of technological changes if they want to conduct business electronically in the future. The lack of exposure to methods and equipment, along with a need for continuing technology education, may deter some clients from using an electronic signature.

Professionals who require Digital Signature Certificate

Under MCA21 all the authorized signatories of company and professionals who sign the manual documents and returns filed with ROC is required to obtain a Digital Signature Certificate (DSC). Therefore following personnel have to procure Digital Signature Certificate:


1.      Directors

2.      CAs/Auditors

3.      Company Secretary - Whether in practice or in job.

4.      Bank Officials - for Registration and Satisfaction of Charges

5.      Other Authorized Signatories.



Contributors Note


Till date no technology is termed as the safest and so is in case of digital signature certificate. DSC is not fully authenticated and secured. Still there is a scope of enhancing the protection or restriction of use of DSC by unauthorized users. It is expected that some futuristic technologies like Thumb impression, voice impression, etc will soon be implemented with that of DSC and make it more protective and user friendly.


Waiting for your valuable feedback at

CAclubindia's WhatsApp Groups Link

Published by

Lalit kundalia
(Articled Clerk)
Category Others   Report

2 Likes   60 Shares   19347 Views


Related Articles


Popular Articles

Follow us
Course 2023 Course 2023

CCI Articles

submit article