Government has recently announced a drive for e-KYC of all the directors of Indian Companies. It was proclaimed as a process of weeding out ghost directors out of the systems. The last date to complete Director KYC process was 15th September, 2018 which has been over now. As per the current norms all the DIN of the directors, who had not complied with the process, will get deactivated and further it shall be reactivated only after payment of penalty of INR 5000/-.
In this whole process, the main concern was to collect the accurate contact details of all the directors, such as PAN number, personal Mobile Number and personal E-mail ID and the main document concerned was Passport. However, as a practical aspect, there were endless glitches faced by the stakeholder while filling up the form, signing it with Digital Signature (DSC), generating OTPs and at the time of uploading the form to the website of Ministry of Corporate Affairs (MCA).
Further as per the Government data, there are about 33 lakh active directors, out of which only 12 lakh directors, only one third of the total active number of directors, have complied with the process. Now it’s a point of consideration to the government that why another 21 lakh directors were not able to complete the process successfully. The jokingly shocking thing is that, even number of politicians, holding respective position in government have also failed to comply with the process.
Several stakeholders i.e. ICSI, ICAI and various Tax Practitioner Associations has made representations about the difficulties faced by them while concluding the process and sought an extension of few days to complete the KYC process.
Considering various issued raised by the stakeholders, government may provide another window to complete the KYC process or may reduce the late fee amount in order to make relief to the remaining directors.
Author Bio
After reading the above article. I have some concerns which I will note down in points.
1. Firstly you pointed out that many directors did not sign up or were unable to that is the question on themselves that why they were not able to. Govt will eventually take steps for them too. Same goes for tax, govt asks everyone to pay taxes but only a few pay it so they take steps later.
2. Secondly about the time and fee, I think if the fine or penalty is less its looses its importance and hence the fine is alright. Yes, for once we can demand an extra window or time as a grace period.
3. Overall