If you are a Director of a Company who is newly appointed or is already part of the Board of any company which could be a listed, unlisted and/or private company. You are required to ensure sufficient care and validity of three important things in your career as a Director,
- 1. Your Attendance
- 2. Your Director Identification Number (DIN),
- 3. Your Digital Signature Certificate (DSC).
ATTENDANCE
Section 167 of the Companies Act, 2013
Every Director is required to attend meetings of the Board of Directors. The provisions laid out in the Act emphasises that importance must be given to the attendance of every Director in the company.
Relevant provisions of the Companies Act, 2013 states that the office of a director shall become vacant in case he absents himself from all the meetings of the Board of Directors held during a period of twelve months with or without seeking leave of absence of the Board.
COMPLIANCE REQUIREMENT
It is necessary for every director to attend at least one Board Meeting within a period of twelve months, the gap between attendance at two Board Meetings shall not exceed 360 days. Additionally, there is also the requirement to specify the attendance of every Director for every financial year.
IMPORTANT TIP
Every individual shall take personal care of the attendance and attend at least one Board Meeting in person or via video conference to ensure that he/she does not vacate their office.
DIRECTOR IDENTIFICATION NUMBER (DIN)
Section 153 of the Companies Act, 2013
WHAT IS A DIN?
It is a unique identification number allotted by the Central Government to a person intending to become a Director of a company and is a pre-requisite before being appointed as a Director of any Company.
HOW DOES A DIN HELP?
DIN facilitates to get a comprehensive list of entities in which an individual is a Director by accessing the same on the portal of the Ministry of Corporate Affairs (MCA).
COMPLIANCE REQUIREMENT
Every person who possesses a DIN shall file e-form DIR-3 KYC every year in order to ensure that the DIN is not disqualified.
IMPORTANT TIP
Every person who is a director shall possess only ONE DIN and share the details of the DIN with a written consent conveying the acceptance to be appointed as a Director of the company.
DIGITAL SIGNATURE CERTIFICATE (DSC)
WHAT IS A DSC?
A DSC is the electronic equivalent of a physical or paper signature. Where physical documents are signed by hand; the electronic documents, for example e-forms are required to be signed digitally using a DSC.
Provisions of the Companies Act, 2013 makes it mandatory for every person intending to become a Director, to first obtain a Director Identification Number (DIN).
It is necessary to procuring a DSC from your authorised dealer only and you shall keep track of the usage of your DSC, as is it can be easily misused by anybody having access to the same.
IMPORTANT TIP
Ensure that your DSC is protected by a password that is strong and contains both alphabets and numbers and that you have knowledge of the documents to which your DCS has been affixed.
Disclaimer: The author is in no event liable for damages of any kind incurred or suffered as a result of the use or non-use of the information presented in this article. All views expressed herein are solely of the author and does not represent the opinions of any entity whatsoever with which it has been affiliated.
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