I am sure lot of professionals would have across this question that Whether Form DIR-12 needs to be filed in case of Appointment of First Directors through SPICE+
Background to this question: Clause (f) & (g) of sub-section (1) of Section 7 of the Companies Act, 2013, prescribes that detailed particular of the persons mentioned in the articles as the first directors, particulars of Interest in other firms or bodies corporate along with their consent to act as Directors of the company shall be filed while incorporating a Company.
Rule 17 of the Companies (Incorporation) Rules, 2014 prescribes that Particulars of first directors mentioned in the Articles along with their Interest in other firms or bodies corporate along with their consent to act as Directors of the company shall be filed in Form No DIR-12.
Further Sub-section 5 of section 152 prescribes that a person appointed as director shall not act as such, unless he gives his consent & such consent is filed with ROC in prescribed form.
Rule 8 of the Companies (Appointment and Qualification of Directors) Rules, 2014 prescribes that every person who has been appointed as director shall on or before such appointment give his consent in Form DIR-2 & such consent to be filed with ROC in form DIR-12 within 30 days of date of Appointment.
Here are the detailed legal provisions for your reference:
Section 7 (1) There shall be filed with the Registrar within whose jurisdiction the registered office of a company is proposed to be situated, the following documents and information for registration, namely:—
(f) the particulars of the persons mentioned in the articles as the first Directors of the company, their names, including surnames or family names, the Director Identification Number, residential address, nationality and such other particulars including proof of identity as may be prescribed; and
(g) the particulars of the interests of the persons mentioned in the articles as the first Directors of the company in other firms or bodies corporate along with their consent to act as Directors of the company in such form and manner as may be prescribed.
Rule 17 of The Companies (Incorporation) Rules, 2014:
The particulars of each person mentioned in the articles as first director of the company and his interest in other firms or bodies corporate along with his consent to act as director of the company shall be filed in Form No. DIR 12 along with the fee as provided in the Companies (Registration offices and fees) Rules, 2014.
Section 152(5) A person appointed as a director shall not act as a director unless he gives his consent to hold the office as director and such consent has been filed with the Registrar within thirty days of his appointment in such manner as may be prescribed.
Rule 8 of the Companies (Appointment and Qualification of Directors) Rules, 2014:
Every person who has been appointed to hold the office of a director shall on or before the appointment furnish to the company a consent in writing to act as such in Form DIR-2:
Provided that the company shall, within thirty days of the appointment of a director, file such consent with the Registrar in Form DIR-12 along with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014.
Provided further that in case the person seeking appointment is a national of country which shares land border with India, necessary security clearance from the Ministry of Home Affairs, Government of India shall also be attached along with the Consent.
So, going through these legal provisions it seems that Form DIR-12 needs to be filed with ROC in case of Appointment of First Directors or Appointment of Director in an existing company along with their Consent to act as Director and Declaration of Interest in other entities.
New process of Incorporation: As we all are aware that now new process of Company Incorporation is being followed through Integrated from SPICE+ (INC-32) & all the Compliances relating to Incorporation of company can be completed though this form like Allotment of DIN to proposed Directors (up to 3), Reservation of Name, Incorporation of Company, Verification of Registered Office & Appointment of Directors on the board of Company.
Rule 12 of the Companies (Incorporation) Rules, 2014, prescribes that an Application for registration of a company shall be filed in Form SPICE+ & Rule 38 prescribes the detailed process & guidelines for filing of SPICE+. So, appointment of Directors & their consent to act as director along with Interest in other entities shall also be captured in SPICE+
While filing SPICE+ form, the details of director for allotment of DIN & appointment as director are duly filled in along with declaration of Interest in other Entities as information & as attachment as well, but there is no mandatory requirement for uploading Consent of Director in DIR-2 in the SPICE+ form. (Although Rule 17 of the Companies (Incorporation) Rules, 2014 still prescribes that Interest of First Directors in Other Entities & their consent to act as First Director shall be file FIR-12)
Declaration in Form DIR-12: In form DIR-12, in the Declaration section, the checkbox of first declaration that states I……………….. a person named in the Articles as a …………………. of the Company (in case of a new company) can’t be checked & if we try to file DIR-12 after Incorporation of Company, with same details as mentioned in SPICE+, while pre-scrutinizing it displays the error that person is already appointed in the Company under same designation.
So, it means Form DIR-12 can’t be filed for Appointment of First Directors as same are already appointed via SPICE+ Forms, but requirement of Filling consent in DIR-2 is not mandatorily complied with.
Conclusion: So legally speaking, Form DIR-12 need to be filed for appointment of First Directors along with their Consent to act as Director and Declaration of Interest in other entities but practically Form DIR-12 cannot be filed for appointment of First Directors as same has already been appointed via SPICE+ form.
Course correction for Professionals, Promotors & First Directors: Until the anomalies are corrected, legal changes are brought into Companies Act 2013, Rule 17 of the Companies (Incorporation) Rules, 2014 is not amended to enable filling of Consent of First Directors in DIR-2 & Notice of Interest in other Entities in in SPICE+ & requirement of Filling DIR-12 for appointment of First Directors is not done away with, it is advisable to obtain such consent in Form DIR-2 & attach the same as Optional Attachment while filing SPICE+.
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The contents of this article are for information purposes only and do not constitute advice or a legal opinion and are the personal views of the authors. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. The possibility of other views on the subject matter cannot be ruled out. Looking forward to your valuable suggestions, input & feedback. Author can be reached on [email protected] or +91-9501084418
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Agree with the conclusion. Keep on sharing thoughts.