This will be part of the government's new Know Your Customer (KYC) norm, which will kick in for close to 35 lakh directors from Tuesday
Directors of over 10 lakh companies currently registered in the country will have to upload their videos in an e-filing to the government in a major crackdown on "fly by night and dummy directors".
Not just that, companies too will be required to upload a video clip of the office premises in a step that is aimed at checking creation of shell companies.
This is a part of the government's new Know Your Customer (KYC) norm, which will kick in for close to 35 lakh from Tuesday under the supervision of Ministry of Corporate Affairs secretary Injeti Srinivas.
An electronic form named DIR-3 KYC will be launched under MCA-21 system by the ministry. "Directors' e-KYC is being done to prevent fly by night operators and dummy directors who are non-existent," a senior official in the ministry said. "All directors of all companies will have to file new KYC form annually," he said.
The e-KYC by the government is likely to be extended to companies by September., sources said.
The deadline for filing the new form by directors is August 31 for 2018-19. Directors will have to provide details such as personal mobile number, e-mail address, Permanent Account Number (PAN) in the new form. The PAN will have to be linked with digital signature certificate and signed by a Chartered Accountant (CA) or a Company Secretary (CS). There will also be a video feature requiring directors to upload a 20 second video clip introducing themselves. However, director's consent will be needed to extract the video. The companies will have to upload a short video clip of the office premises.
From next year, the new form is likely to be filed by the directors annually at the time of filing annual statements.
Late filing of e-KYC filing will attract a fee of Rs 5,000 after August deadline. However, the filing can be done free of cost till then. Every director who has been allotted Director Identification Number (DIN) on or before March 31, 2018 will have to file it. The new e-KYC rule will also apply to those directors who have been disqualified by the government in the past for flouting norms.
MCA will act as a KYC certifying authority for the companies as well as for the directors. The authentication will be done by it once PAN is verified by Central Board of Direct Taxes (CBDT) and digital signature by the concerned agencies. The KYC for directors is being introduced under the Rule 12 A of the Companies Act that deals with the appointment and qualification of directors.
If the directors and the companies do not comply with the new KYC norm, the directors will be disqualified from holding the post of director at a company, while companies will lose their registration as per the provisions of the Companies Act, 2013.
This tightening of the noose around the companies comes at a time when the government has already struck off 2.26 lakh companies for having failed to file their financial statements or annual returns for a period of two or more successive years. Similarly, more than three lakh directors have been disqualified for non-filing of annual returns by the companies for three years. The drive was launched in the last financial year post demonetisation. In the latest crackdown, the MCA recently identified another 2.25 lakh companies for action.
SHELL CO CRACKDOWN
- This will be part of the government's new Know Your Customer (KYC) norm, which will kick in for close to 35 lakh directors from Tuesday
- Companies too will be required to upload a video clip of the office premises in a step that is aimed at checking creation of shell companies
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