DIR-3 KYC: File on Time to Avoid Deactivation of DIN

A couple of years ago, the Central Government came up with an initiative of updating the KYC of directors in order to have transparency in DIN holders’ database. Consequentially, the onus is on every director to update his KYC annually via form DIR-3 KYC.

Rule 12A and Rule 11(2) and (3) of the Companies (Appointment and Qualification of Directors) Rules, 2014 governs the filing of form DIR 3 KYC. Here, in this article, let’s find out all the crucial matters concerned with the filing of this form.

What is DIR-3 KYC?

As part of updating its registry, the Ministry of Corporate Affairs (MCA) seeks to conduct the KYC of all the directors of all companies annually through the e-form DIR-3 KYC.

DIR 3 KYC is an e-form designed for directors to update their KYC details with the Ministry of Corporate Affairs (MCA). Even disqualified directors are bound to file Form DIR 3 KYC provided they have been allotted DIN and where the status of such DIN is ‘Approved’.

DIR-3 KYC due date

Every director who has been allotted a DIN on or before the end of a financial year (i.e., 31st March), and whose DIN status is ‘Approved’, is compulsorily required to file e-Form DIR 3 KYC before 30th September of the immediately next financial year.

For example, for the financial year ending on 31st March 2019, an individual holding DIN shall submit a DIR-3 KYC form on or before 30th September 2019.

What details are to be mentioned

A director needs to furnish the following information in the form:

  • Name (as per PAN database)
  • Father’s Name (as per PAN database)
  • Date of Birth (as per PAN database)
  • PAN Number
  • Personal Mobile number
  • Personal Email Address
  • Permanent/ Present address
  • Where the DIN holder is an Indian resident, the address must be an address in India and the mobile number must be an Indian mobile number. But where the DIN holder is a non-resident, only foreign address and the foreign number are accepted.
  • Copy of Aadhaar card to be attached
  • If Aadhaar is not assigned, then Voter ID or Passport or Driving License is to be attached

Note: The director’s personal mobile number and personal email ID must be unique such that it is not already associated with some other person in the DIN holders’ database.

How to file DIR-3 KYC?

Let’s have a look at the steps involved in filing the e-form DIR 3 KYC.

  • Download the form from MCA’s website
  • Furnish the necessary details including DIN, name & relevant credentials, nationality, address, etc.
  • Submit PAN and the system verifies the details of the director on the basis of the PAN card details
  • After successful scrutiny of the form, the user needs to click on the ‘Send OTP’ button. Separate OTPs will be sent to the user’s mobile number and email ID as updated with MCA.
  • The form has to bear two digital signatures, i.e., one of the ‘DIN holders’ and another of a practicing professional (CA/CS/CMA) certifying the form.
  • Once the form is submitted successfully, an SRN is generated and allotted to the user for future correspondence with the MCA.
  • The applicant then receives an email that acknowledges the receipt and approval of the form.
  • On success, all the information as entered in ‘e-Form DIR 3 KYC’ gets updated in the DIN holders’ database.

DIR-3 KYC form can be downloaded from this MCA’s link.

A specimen form is as given here:

No change in KYC details

There is often no change or update in the KYC details of a director. In such a case, he has an option to perform his annual KYC by accessing the DIR-3 KYC-web service. However, this is subject to the condition that e-Form DIR-3 KYC has been successfully filed by him for any of the previous financial years.

For example, if a DIN holder has successfully filed his e-Form DIR-3 KYC for the financial year 2018-19, then he may resort to DIR 3 KYC-web service to ensure his annual compliance for the next financial year as long as there is no change in his KYC.

DIR 3 KYC-web service enables only a confirmation of KYC verification. An individual needs to log in to MCA’s website, navigate to MCA services – DIN Services – DIR 3-KYC-WEB, enter DIN, and verify KYC details through an OTP generated on his mobile or e-mail ID.

DIR 3-KYC-WEB

It should be borne in mind that a director who is filing his KYC details for the first time with MCA, needs to render all his KYC details only through the submission of e-Form DIR 3 KYC. There is no option for such a person to access the web-service for his KYC.

Thus, it can be inferred from above that the web-service for KYC is accessible only when:

  • A DIN holder is filing his annual KYC for the second time (or subsequent); and
  • There is no update in his KYC details as submitted previously.

Else, e-Form DIR 3 KYC is the only recourse.

Default and Penalty fee

The filing of e-Form DIR 3 KYC or DIR-3 KYC-web service does not attract any fee. But this holds valid only up to the expiry of the due date.

For all those directors who fail to update their KYC by the due dates, the system marks their DINs as ‘Deactivated due to non-filing of DIR-3 KYC’. The status continues to be marked as such until the KYC is done by payment of a late fee of Rs. 5,000 (either through e-form DIR 3 KYC or web-service, as the case may be). On approval, the system would automatically reactivate the DIN.

Annual compliance of KYC

This is an annual exercise which means that if the KYC is done in one financial year, it need not be done again in the same financial year.

For example, DIN is issued on 30th Jun 2018. The due date for the first KYC to be filed in e-Form DIR-3 KYC was 30th September 2019. If the DIN holder does not file the form within the due date, DIN is marked as ‘Deactivated due to non-filing of DIR 3 KYC’. Now in case, the form DIR-3 KYC is filed with a fee of Rs. 5000 before 31st March 2020, KYC will be considered to have been done for the FY 18-19.

However, if the form DIR-3 KYC is filed with a fee of Rs. 5000 on or after 1st April 2020, KYC will be considered to have been done for the FY 19-20, and the DIN holder will remain KYC non-compliant for FY 18-19. Now this DIN holder need not file e-Form DIR 3 KYC or access the web service DIR 3 KYC again for FY 19-20.

Multiple DINs

Where a director holds multiple DINs, then he/she should retain the oldest DIN and surrender all others by the filing of e-Form DIR-5. Thereafter, KYC should be done for the oldest retained DIN.

Key takeaways

Annual KYC is mandatory for all directors holding DIN.

For a DIN holder as of 31st March of an FY, the due date of filing KYC is 30th September of the next FY.

Filing/accessing of DIR-3 KYC form/DIR-3 Web service after the due date attracts a penalty fee of Rs. 5,000.

DIR-3 KYC

*DIN = Director Identification Number

Hope the information provided in this article proves helpful to you!

Also read: A Complete Guide on Filing of AOC 4 Form

Ruchi Gandhi

The author enjoys to write informational content in the domain of company law and allied laws. She takes interest in doing thorough and analytical research on legal topics. She is a CA along with MBA (Fin) and M. Com.

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