Director Compliance: DIN, KYC, Appointment and Resignation in Jhalawar

What Is Director Compliance?

A company can act only through its directors, so the law keeps a close watch on who they are, whether they are eligible and what they have disclosed. Director compliance is the set of obligations that arise for each director and for the company in relation to directors. These include the director's identity number (DIN), the yearly KYC update, the consent and declarations at the time of appointment, the disclosure of interests in other entities, the filings when a director joins, leaves or changes details, and the maintenance of the statutory registers. The main provisions are in Sections 149 to 170 and Section 184 of the Companies Act, 2013, along with the Companies (Appointment and Qualification of Directors) Rules, 2014.

Many companies think of this only when a director joins or leaves. In reality, a director who is already in office can fall out of compliance, for example, through a missed KYC deadline or because the company stopped filing returns, without anyone noticing until a bank, investor or the Registrar raises it.

Key Director Compliances

• Director Identification Number (DIN): every person who wishes to be a director must have a DIN, obtained through Form DIR-3 on the MCA portal. A person has only one DIN for life, and it should not be duplicated.
• DIR-3 KYC: every individual who holds a DIN has to update personal KYC details with the MCA at the intervals and by the dates the rules prescribe. Failure leads to the DIN being marked "deactivated due to non-filing of DIR-3 KYC" and a fee for reactivation. The frequency and process have been revised by the MCA in recent years, so we confirm the position at the time of filing.
• Appointment documents: consent to act as director (DIR-2), declaration that the person is not disqualified (DIR-8), and disclosure of interest (MBP-1), together with the board or shareholder resolutions that the Act and the articles require.
• DIR-12: filed by the company within 30 days of the appointment, change in designation, or cessation of a director, with the required attachments.
• Resignation (DIR-11 and DIR-12): a director who resigns gives notice to the company and may file DIR-11 with the Registrar, and the company files DIR-12 within the time allowed.
• Change in particulars (DIR-6): where a director's name, address, email or other details linked to the DIN change.
• Statutory registers: Register of Directors and Key Managerial Personnel, and the register of contracts or arrangements in which directors are interested.

Eligibility, Disqualification and Limits

Section 164 of the Act lists the reasons for which a person cannot be appointed as a director or must stop being one. Examples include being of unsound mind, an undischarged insolvent, convicted of certain offences, or not having a DIN. Section 164(2) adds that a director of a company that has not filed its financial statements or annual returns for three continuous financial years, or has failed to repay deposits or debentures within the time allowed, is disqualified from being appointed or reappointed as a director of that company and of other companies for five years. Section 167 provides for vacation of office in certain cases, such as absence from all board meetings for a continuous period of twelve months.

There are also structural requirements. Every company must have at least one director who has stayed in India for at least 182 days in the previous calendar year. Section 165 caps the number of companies in which a person may serve as a director. Independent directors, where applicable, must be registered in the independent directors' databank and meet the criteria of independence. We check these points when we plan an appointment.

Compliance for LLP Partners

Designated partners of an LLP also need a DIN (earlier called DPIN). They are required to complete DIR-3 KYC, and the LLP must file Form 4 for appointment, change or cessation of partners within 30 days. An LLP must have at least two designated partners, and at least one of them must be resident in India, as defined in the LLP Act and Rules.

What Our Director Compliance Service Includes

• A review of the status of each director's DIN and KYC on the MCA portal, and a list of pending items.
• Application for a new DIN through DIR-3, where a new person is being appointed and does not have one.
• Filing of DIR-3 KYC for directors and designated partners, including with updated mobile and email verification.
• Reactivation of a deactivated DIN, with the filing of pending KYC.
• Drafting of appointment documents: notice, resolutions, DIR-2, DIR-8 and MBP-1, as applicable.
• Filing of DIR-12, DIR-11 support, DIR-6 and LLP Form 4, within the required time.
• Updating of the registers of directors and of interested directors.
• A disqualification and directorship check based on the data available on the portal.
• A calendar of director-related due dates for the year.

How the Process Works

We start by asking which director events are due or have happened. If you plan to appoint a new director, we check eligibility and whether a DIN exists, and prepare the notice and resolutions. We then collect identity and address documents and have the person sign the consent and declarations. The forms are filed on the MCA portal with the required digital signatures, and we track them until the Registrar approves them. For KYC, each director completes OTP verification on the registered mobile and email, which we guide. We share acknowledgements and update your registers. Time depends on the Registrar's processing and on how quickly directors provide documents and signatures.

Common Triggers for Director Compliance Work

• A new director is appointed, or an existing director is made an additional director, managing director or whole-time director.
• A director resigns, retires by rotation, dies or is removed.
• A director's address, email or mobile number changes.
• A bank, investor or auditor flags that a DIN is deactivated.
• The company has overdue ROC filings and the directors worry about disqualification.
• A person wants to know the limit on directorships or the effect of Section 164.

Important Considerations

• The company, not the departing director alone, is responsible for filing DIR-12 for cessation, so do not rely on a resignation letter alone.
• Appointments of managing and whole-time directors have additional requirements, including shareholder approval and a separate filing.
• Directors are personally accountable for the declarations they sign, so we explain each document before it is signed.
• Notices from the Registrar about disqualification, removal of directors or striking off are separate services.