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Amendment of Companies Rules for Appointment and Qualification of Directors

  • June 04, 2022
  • Registrationwala
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The Ministry of Corporate Affairs issued a notification to amend the existing Companies (Appointment and Qualification of Directors)Rules, 2014. As per the official gazette, this amendment is termed as the Companies (Appointment and Qualification of Directors) Amendment Rules of 2022.

This amendment makes it mandatory for an individual who is a national of a country that shares a land border with India to seek security clearance from the Ministry of Home Affairs, Government of India.

The individual must attain security clearance before he/she files an application for the Director Identification Number (DIN). The Director Identification Number is a unique identifier issued to the director of a to-be-registered company. 

Amendments Rules:

1.      In Rule 8 of the Companies (Appointment and Qualification of Directors)Rules of 2014, the MCA (Ministry of Corporate Affairs) has inserted the following provison:

“Provided further that if the person seeking appointment is a national of a country which shares a land border with India, necessary security clearance from the Ministry of Home Affairs, Government of India shall also be attached along with the consent.”

2.      In Rule 10 of the Companies (Appointment and Qualification of Directors)Rules of 2014, the MCA (Ministry of Corporate Affairs) has inserted the following provison: 

“Provided that no application number shall be generated in case of the person applying for Director Identification Number is a national of a country which shares a land border with India, unless necessary security clearance from the Ministry of Home Affairs, Government of India has been attached along with the application for Director Identification Number.”

Both these amendments clearly inform that any individual who wants to apply for the Director Identification Number and who also is a national of India’s border sharing countries must get a security clearance from the Ministry of Home Affairs.

After getting the required security clearance, he/she can apply for DIN registration by attaching the security clearance certificate with the DIN application.

Annexures:

3.      In the form DIR-2, under the heading Declaration, after the existing paragraph enumerated as (i), the following will be inserted:

“(ii) I further declare that

I am not required to obtain the security clearance from the Ministry of Home Affairs, Government of India, before seeking an appointment as a director; _______

OR

I am required to obtain the security clearance from the Ministry of Home Affairs, Government of India, before seeking an appointment as director, and the same has been obtained and is attached. _______”

4.      In the form DIR-3, under the heading Verification, after serial number 3, the following serial number will be inserted:

“3A. I am not required to obtain a security clearance from the Ministry of Home Affairs, Government of India, under sub-rule (1) of rule 10, before applying for a director identification number; _______

OR

I am required to obtain the security clearance from the Ministry of Home Affairs, Government of India, under sub-rule (1) of rule 10, before applying for a director identification number, and the same has been obtained and is attached. _______ and .”

Here, both the above-mentioned forms are:

·         Form DIR-3: This form is an application to be filled by an individual for allotment of the Director Identification Number.

·         Form DIR-2: This form is to be filled by the individual to give his consent to act as a Director of the mentioned company.

These forms are amended as per the notification to incorporate the aforementioned paragraphs.


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