Avail 20% discount on updated CA lectures for Dec 21 .Use Code RESULT20 !! Call : 088803-20003

ICICI

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Email

Share More


SHORT SUMMARY

In this editorial, the author shall discuss about dilemma that whether an Individual can apply for DIN before Incorporation of Company, in other words. If Someone wants to have DIN, but such person doesn't have any relation with any company and does not want to incorporate a company right now, whether such a person can apply for DIN? If yes, what shall be the procedure of the same?

GENERAL PROVISION

Section 153

Every individual intending to be appointed as director of a company shall make an application for allotment of Director Identification Number to the Central Government in such form and manner and along with such fees as may be prescribed.

Rule 9(1)

Every applicant, who intends to be appointed as director of an existing company shall make an application electronically in Form DIR-3, to the central Government for allotment of a Director Identification Number (DIN) along with such fees as provided under the companies (Registration offices and Fees) Rules, 2014.

Provided that in case of proposed directors not having approved DIN, the particulars of maximum three directors shall be mentioned in Form No.INC-32 (spice) and DIN may be allotted to maximum three proposed directors through Form INC-32 (spice).

How to apply for DIN before incorporation of company

WAYS TO OBTAIN DIN

There are two way to get DIN:

i. In case individual incorporating New Company, he can apply DIN with Incorporation Form.
Condition: Only three DIN can get apply with Incorporation form.

ii. In case individual getting appointment in existing Company.
Condition: Such company pass a board resolution for application for DIN of such Individual and such Resolution needs to attach in e-form DIR-3.

 

POINT OF ANALYSIS

There can be the following Situations:

  • Promoters wants to incorporate Company with more than three directors and all directors no having DIN. In such case how to obtain DIN?
  • A person wants to obtain DIN but don't want to get appointment in any Company as on date.

ANALYSIS

Situation 1: Incorporation with more than 3 Directors (not having DIN)

As per Section 153 read with Rule 9(1) Companies (Appointment and Qualification of Directors) Rules, 2014, the particulars of maximum Three Directors shall be mentioned in Form No.INC-32 (spice) and DIN may be allotted to Maximum Three Proposed Directors through Form INC-32 (spice).

It is clear from the legal provisions, that at time of incorporation maximum 3 Din can apply. If more than 3 person (not having DIN) want to incorporation Company in such case:

  • First, they have to incorporate Company with three Directors, and
  • Then appoint fourth director after Incorporation with Board Resolution of Company

Note: Only issue in above process is that, name of fourth person shall not be appear in Article of Association as first director of the Company.

Situation 2: Application for DIN without Board Resolution of any existing Company/ LLP

As per Section 153 read with Rule 9(1) Companies (Appointment and Qualification of Directors) Rules, 2014,Every applicant, who intends to be appointed as director of an existing company shall make an application electronically in Form DIR-3, to the central Government for allotment of a Director Identification Number (DIN) along with copy of board resolution proposing his appointment as director in an existing company.

It is clear from the legal provisions, that DIN can not be alloted a person without

  • Copy of Board Resolution of his appointment as director in an existing Company.
  • DSC of Director of Existing Company on form DIR-3
 

Conclusion

After reading above mentioned provisions and situations one can opine that as on date there are only two options to get DIN. One with incorporation form and second with Copy of Board Resolution of existing Company. If a person doesn't comply with any of the above provisions, he can't get DIN from the Ministry.

"Loved reading this piece by CS Divesh Goyal?
Join CAclubindia's network for Daily Articles, News Updates, Forum Threads, Judgments, Courses for CA/CS/CMA, Professional Courses and MUCH MORE!"




Tags :



Category Corporate Law, Other Articles by - CS Divesh Goyal 



Comments


update