In this editorial, 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 don’t want to incorporate Company right now. Whether such person can apply for DIN? If yes, what shall be the procedure of the same?
A. GENERAL PROVISION:
i. 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.
ii. 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).
B. 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.
C. POINT OF ANALYSIS:
There can be following Situations:
i. Promoters wants to incorporate Company with more than three directors and all directors no having DIN. In such case how to obtain DIN?
ii. A person wants to obtain DIN but don’t want to get appointment in any Company as on date.
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:
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 allot a person without
After reading above mentioned provisions and situations one can opine that, As on date there are only two option 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 above provision, he cant get DIN from the ministry.
Author – CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice from Delhi and can be contacted at [email protected]).
Disclaimer: The entire contents of this document have been prepared based on relevant provisions and as per the information existing at the time of the preparation. Although care has been taken to ensure the accuracy, completeness, and reliability of the information provided, I assume no responsibility, therefore. Users of this information are expected to refer to the relevant existing provisions of applicable Laws. The user of the information agrees that the information is not professional advice and is subject to change without notice. I assume no responsibility for the consequences of the use of such information. IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION WITH THE USE OF THE INFORMATION