DIR-3 KYC- Uses, Importance, Filing Procedure, Fee, Pros And Cons
DIR-3 KYC- Uses, Importance, Filing Procedure, Fee, Pros And Cons

 

In this era of digitization, the DIR-3 application form becomes handy when you want to obtain the unique Director Identification number (DIN). This process is designed for anyone with the ambition of becoming a director in one or more companies. The recent move by the Ministry of Corporate Affairs (MCAs) has directed all directors that already has DIN to update their details electronically in a DIR-3 KYC.

However, noncompliance with this directive has generated complaints among directors of various levels and many are faced with the risk of disqualification or other penalties.

WHAT DOES THE DIRECTOR KYC UPDATE MEAN?

Below is a replica of the MCAs directive for directors to update their KYC info as seen on its web address www.mca.gov.in:

“As part of updating its registry, MCA would be conducting KYC of all Directors of all companies annually through a new eForm viz. DIR-3 KYC to be notified and deployed shortly.”

WHO SHOULD FILE e-FORM DIR-3 KYC?

The recent announcement by the MCA mandates all directors that have the DIN on or before March 31st, 2018 and with a DIN approved status to submit their KYC information before the end of August to the MCA. In addition to this, the disqualified directors are to partake in the exercise.

After the expiration of the period for the update, all non-compliant directors who have failed to update their DINs with the DIR-3 KYC will be automatically marked as deactivated.

WHAT ARE THE NECESSARY CHECKPOINTS IN FILING THE e-FORM DIR-3 KYC?

  1. While filing the eForm, you should provide your unique mobile number and email address which will be authenticated through the one-time password (OTP).
  2. Another point of the check while filing the form is that you should use your personal digital signature.
  3. To ensure that you are providing the correct information, a practicing Chartered Accountant or a Cost and Management Accountant or a Company Secretary is required to certify the e-Form.

HOW DOES THE OTP FUNCTIONALITY IN DIR-3 KYC WORK?

After the successful pre-scrutiny of the form, the send OTP button will be activated. Once it is activated, you should click on the ‘Send OTP’.

WHO ARE THE SIGNATORIES IN A DIR-3 KYC FORM?

The two signatories in the form are the DIN holder and a practicing Accountant or Company Secretary who is to certify the form.

For Indian Citizens, the PAN included in the DSC will be verified along with the PAN that is filed in the form.

For foreigners, the name that appears in the DSC should be the same with the one on the form. Such DSCs used in the form should be properly registered so it could be available on the MCA portal.

WHAT HAPPENS IF e-FORM DIR-3 KYC IS NOT FILED WITHIN THE DUE DATE?

In situations that the director is unable to file the e-Form before the due date of August 31st, 2018 which has been extended to September 15th, 2018, the DIN of such a director will be marked ‘deactivated’ on the MCA portal.

If the director intends to get his DIN activated in future by filing the e-form, he will pay a late fee of Rs 5000. The payment of this fee commenced after the due date.

WHAT IS THE VALIDITY OF THE OTP AND WHY IS THE ‘SEND OTP’ BUTTON DISABLED?

The OTP function is invalidated after 30 minutes of successfully receiving the code which is sent to your phone number and email address.

The send OTP button becomes active only if the pre-scrutiny of the form is successful of which time you can save the form.

WHY IS IT THAT THE OTP CANNOT BE RECEIVED ON EMAIL?

If you observed that you are unable to receive the OTP in your email inbox, you can check your email spam folder.

WHAT ARE THE DOCUMENTS REQUIRED FOR FILING DIR-3 KYC?

Before you start filing the e-form, ensure that following documents are available:

  1. Information of your citizen including your date of birth and gender.
  2. Permanent Account Number(PAN)
  3. Voters identity card
  4. A mandatory passport for foreigners with a DIN
  5. Driving License
  6. Aadhaar card
  7. Residential address
  8. Email address and personal mobile number

In addition to the above other items that must be readily available before filling the form are:

  1. Your digital signature
  2. Attestation to the listed documents by practicing professionals in Accounting. For Foreign nationals, the documents must be certified by the appropriate authority.
  3. You should provide a declaration which is duly certified by a professional in the accounting sector.

WHAT ARE THE APPLICABLE FEES FOR FILING YOUR DIR-3 KYC

For directors who has had their DIN status approved and was allotted a DIN prior to 31st of March 2018, such will be exempted from paying any fees for KYC that was filed on or before the 15th of September 2018. However, if your DIN status was deactivated because of your failure to comply with the MCA directives, then you will pay Rs 5000 to file your DIR-form after August 31st, 2018.

WHAT ARE THE PROCEDURES FOR FILING YOUR DIR-3 KYC?

The following the processes you must take in filing your DIR-3 KYC:

  1. DOWNLOAD THE FORM: The first thing is to visit the MCA website to download the e-form.
  2. PROVIDE YOUR DIN INFO: both Directors and individuals must ensure that their DIN information is provided in KYC form. Note that the DIN status must be approved. Directors with a deactivated DIN status can now file the form after the late filing fees must have been paid.
  3. PROVIDE THE REQUIRED DETAILS: The most relevant detail must be provided in the form and this include:
  4. Name and academic qualifications: the name entered here should not be different from the one in your PAN.
  5. Address: your address should match with the one mentioned in your PAN and will be verified. Note that no short forms or acronyms are allowed. Ensure that you mention your permanent address and matches with your proof of residence attachment.
  • Nationality: for foreign nationals serving in the capacity of a director, the nationality should be as mentioned in your passport. Declaration of nationality is very important.
  1. VERIFICATION OF PAN: Declaration of your PAN is very important. On entering your PAN, click on ‘Verify Income-tax PAN’ button. Your PAN will be automatically verified by the system based on the information provided. To ensure a successful validation, the PAN on DSC, must not differ from that mentioned in the form. Foreign nationals who do not have a PAN should ensure that the names on the form are the same on the DSC.
  2. CONTACT DETAILS AND OTP VERIFICATIONS: You must mention your mobile phone number by which the OTP can be received. Non-Indian residents can insert their country codes provided they not +91/91/0. Your personal email ID should be mentioned. On submitting your email and phone ID, click the ‘SEND OTP’ button. You will be able to receive separate OTPs sent to your email box and phone number.
  3. ATTACHMENTS: as an applicant, you are to upload documents that a fully attested to which include:
  4. Proof of permanent address such as utility bills
  5. Aadhaar card
  • Passport
  1. Proof of current address.

All attachments that are optional should be signed digitally.

  1. E-FORM CERTIFICATION: The form should be digitally signed by any of these professionals which are; a Chartered Accountant, Cost Accountant and a Company secretary. Ensure to include the details of the professional in addition to their digital signature. Endeavor to proofread the details before clicking the ‘submit’ button.

WHAT HAPPENS AFTER SUBMITTING THE FORM?

After successfully submitting the e-form DIR-3 KYC, you will be given an SRN. The SRN string generated will be used for your future transactions with the MCA.

IS THERE ANY TIME LIMIT FOR FILING A DIR-3 KYC?

Before now, the time limit for filing the DIR 3 KYC form was August 31st, 2018 but it has now been extended to September 15th, 2018.

WHAT IF THE ‘DIN’ IS DEACTIVATED?

If your DIN was allotted prior to 31st of March 2018 and your DIN was disqualified because of a non-compliance, then you should file for DIR-3 KYC before the 15th of September 2018.

DOES THE DIR-3 KYC FORM APPLY TO LLP?

Under Section 153 of the Companies Act 2013, DIN is allowed for both partners and designated partners. Thus, if you are an LLP with a valid DIN allotted on or before the March 31st, 2018, you should file for a DIR-3 KYC on or before the 15th of September 2018.

CAN NON-RESIDENT DIRECTORS PROVIDE INDIAN MOBILE NUMBERS?

if you are a director with a DIN number and is residing in India, your permanent address and phone number must be Indian.

However, if you are a DIN holder but you are not residing in India, then your foreign mobile number and home address shall not be permitted.

WILL THE SYSTEM ALLOW MULTIPLE FILING OF DIR-3 FORM?

  1. The system will not in any way allow you to file your DIR -3 form more than once. Where the DIN has been filed and you make an attempt to file another, the system will pop out an error message which implies that such a DIN already exists.

WHAT ARE THE CONSEQUENCES OF NON-COMPLIANCE WITH DIR-3 KYC FORMS

  1. Your DIN will be deactivated.
  2. You will not be eligible to sign any e-forms that are related to your company.
  3. All approval DINs that were allotted on or before the 31st of March 2018 will lose its approval status and marked ‘deactivated’.
  4. If you fail to sign up after the 15th of September 2018, you will be mandated to pay a penalty fee of Rs 5000 before you can commence the steps of filing the DIR-3 KYC.

HOW YOU CAN GET A DEACTIVATED OR DISQUALIFIED DIN RESTORED?

  1. Ensure that you make the late fees payment after the due date.
  2. Restart the procedure for filing your DIR-3 KYC.
  3. Upload the attachments.
  4. Sign the documents digitally
  5. Get your documents attested to by a practicing professional in the field of accounts.
  6. Get your OTP
  7. Submit your form and
  8. Obtain your generated SRN

 

 

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