The government has commenced the process to deactivate the Director Identification Numbers (DINs) of 21 lakh directors out of 33 lakh active directors who were asked to share their detail in mass KYC (Know Your Customer) drive. The government earlier this month announced to de-list another 1 lakh companies to prevent illegal fund flows.
The corporate ministry stated that only 12.16 lakh directors participated in KYC drive. As per a news report by PTI quoting a government official, Directors failing to obey the instruction are going to face issues. They will have to pay a fee of ₹5,000 with the requisite form to reactivate their accounts. Hence, if the directors haven’t done KYC requisite, they might not be able to sign any legal document for the company.
The DIR-3 KYC e-form is a mandatory drive introduced by the government in order to monitor shell companies. The KYC details to be filled by directors included personal details like residential address, email address, and mobile number. Along with this, the directors were also required to give details of their PAN card, Aadhaar, and passport.
In the previous year, the government has removed over 3 lakh people from directorship at registered companies as they did not have any activity record for a long time.