(26^th July 2023)

SHORT SUMMARY:

The Director Identification Number was implemented to enhance corporate governance, track and monitor the activities of company directors, and prevent multiple directorships by individuals without proper disclosure. It has been a crucial identification number for directors in Indian companies since its launch in 2007.

A Director Identification Number (DIN) is a unique 8-digit alphanumeric number issued by the Ministry of Corporate Affairs (MCA) in India to individuals who wish to become directors of companies. It is a mandatory requirement for any person who wants to hold the position of a director in an Indian company.

In this editorial, the author shall discuss a very important question: Detailed process of Surrender of DIN.

The powers of allocation and approval of surrender of DIN are vested with the Regional Director, Northern Region, Delhi. All the applications from India in relation to DIN surrender were handled by the RD, Delhi.

A.    LEGAL PROVISION:

Rule 11 Surrender of DIN:

The Central Government or Regional Director (Northern Region), Delhi or any officer authorized by the Regional Director may, upon being satisfied on verification of particulars or documentary proof attached with the application received along with fee as specified in Companies (Registration Offices and Fees) Rules, 2014] from any person, cancel or deactivate the DIN.

B.     GROUNDS FOR SURRENDER OF DIN:

As per provisions of Section 153 Companies Act read with Rule 11 a person can surrender his/ her DIN on below mentioned grounds.

a)     the DIN is found to be duplicated in respect of the same person provided the data related to both the DIN shall be merged with the validly retained number;

b)     the DIN was obtained in a wrongful manner or by fraudulent means;

c)      of the death of the concerned individual;

d)    the concerned individual has been declared as a person of unsound mind by a competent Court;

e)      if the concerned individual has been adjudicated an insolvent:

f)       on an application made in Form DIR-5 by the DIN holder to surrender his or her DIN along with declaration that he has never been appointed as director in any company and the said DIN has never been used for filing of any document with any authority, the Central Government may deactivate such DIN.

C.    How to check how many DIN holds by a person:

A person should preferably cross check from the MCA website that whether he is occupying more than one DIN as per process given below:

STEPS:

        i.            Go to MCA website Link:   http://www.mca.gov.in/

     ii.            Log in by your user ID on MCA V2 portal.

   iii.            Click on “Companies/LLPs in which a person is/was a director/Designated Partner”

   iv.            Click on Search Button in from of DIN/DPIN

     v.            Mention the Name, Father Name and Date of Birth and search.

   vi.            MCA will appear the No. DIN allotted to you.

If you find more than one DIN in your name, you should immediately take steps to surrender the duplicate DIN.

NOTE: in case of duplicate DIN, you can surrender only NEW DIN. Old DIN can’t be surrendered. The companies in which you have appointed from New DIN all those companies shall be migrate to old DIN by RD on your application of surrender.

D.   Question to be Discuss:

ü  How to Surrender DIN (In any of above six situations)?

E.     Discussion on the Questions:

DIN can be surrendered on the above 6 grounds mentioned under Rule 11.

1)     In case of situations c, d and e: In case of surrender of DIN due to situation c, d and e of Rule 11 the application can be filed by any other person on behalf of the DIN holder.

2)     In case of situations a, b and f: In case of surrender of DIN due to situation a, b and f of Rule 11 the application can be file by the applicant itself.

F.      Process of Surrender of DIN:

DIN can be surrendered on the above 6 grounds mentioned under Rule 11. However, there is little difference in the process of surrender of DIN in situation 1 and 2 mentioned above.

Situation 1:

   i.            An application on behalf of the holder of DIN shall be made by applicant for surrender with Regional Director.

ii.            The application shall be made in web form DIR-5 on MCA V3 portal.

iii.            Applicants have to create an ID on MCA V3 Portal or can file such form with the ID of any professional.

iv.             DSC of applicant also required to file the form.

v.            The form shall be certified by the practicing professional also.

Attachments of DIR-5

v Self-attested copy of PAN Card of Applicant

v Self-attested copy of Address proof of Applicant

v Copy of Death Certificate/ order declaring DIN holder insolvent or unsound mind

v Affidavit of surrender of DIN (Draft Attached)

Information Of Applicant Required Being Mentioned In DIR-5:

        i.            Name

     ii.            Relation with DIN Holder

   iii.            DIN of applicant, if any

   iv.            PAN

     v.            Phone No & Email ID

   vi.            DSC

Situation 2:

        i.            The DIN holder shall file an application for surrender of DIN with Regional Director.

ii.            The DIN holder shall be made in web form DIR-5 on MCA V3 portal.

iii.            The DIN holder has to create an ID on MCA V3 Portal or can file such form with the ID of any professional.

iv.             DSC of the DIN holder is also required to file the form.

v.            The form shall be certified by the practicing professional also.

Attachments of DIR-5

v Self-attested copy of PAN Card of Din Holder

v Self-attested copy of Address proof of Din Holder

v Affidavit of surrender of DIN (Draft Attached)

CONCLUSION:

As discussed, there are different situations for surrendering DIN. The most important thing a professional or DIN holder should keep in mind is that if you are surrendering the DIN due to a duplicate DIN, Then you have to apply for adjudication of penalty with ROC after filing an application for surrender of DIN.

There is a order passed by ROC Chennai in case of Shri Thiyagarajan Parthasarathy u/s 454 for noncompliance of Section 155 and imposed penalty on the DIN Holder.

Author – CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice from Delhi and can be contacted at csdiveshgoyal@gmail.com). 

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