Introduction

In this digital period, a Digital Signature Certificate (DSC) is needed for business transactions and compliance, mainly for private limited companies. Through a DSC, anyone filing documents online can guarantee their genuineness, integrity and security. In India, applying for a DSC is essential both to incorporate a private limited company and to process important official government documents.

What is a Digital Signature Certificate (DSC)?

A Digital Signature Certificate (DSC) is an electronic identification system given by a certifying authority (CA) to confirm who the holder is. It creates its signature using public key encryption. They are mostly used to sign documents online, confirm the user’s identity and verify that the document has not been modified since being signed.

Importance of DSC for Private Limited Companies

• Mandatory for Company Incorporation:

1. DSC is required by the Ministry of Corporate Affairs (MCA) when registering a private limited company.
2. People signing on behalf of companies should electronically sign forms such as SPICe+, MOA, AOA and various ROC documents.

• E-Filing of Statutory Documents:

1. There must be a DSC signature on DIR-3 KYC, AOC-4, MGT-7 and all other types of ROC compliance filings.

• Secure and Legally Recognised:

1. DSCs are recognised in law through the Information Technology Act, 2000.
2. It saves crucial documents securely, quickly and prevents any alteration.

• Used for GST and Income Tax Filings:

1. DSC is necessary for GST registration, filing taxes online and signing your ITRs.

Types of DSCs

There are three classes of DSCs. However, for a private limited company, Class 3 DSC is most commonly used:

• Class 1: Used for securing email communications (rarely used for company purposes).

• Class 2 (discontinued after Jan 2021): Previously used for ROC filings.

• Class 3: Required for all company-related filings including incorporation, MCA services, GST, Income Tax Returns (ITR), and e-Tendering.

Who Needs a DSC in a Private Limited Company?

• Directors

• Authorized Signatories

• A Chartered Accountant or Company Secretary may complete the company’s returns.

• Designated Partners for Limited Liability Partnerships

Documents Required for DSC Application

• Identity Proof (any one of the following):

1. Indian citizens must have a PAN Card.
2. Passport for foreigners

• Address Proof (any one of the following):

1. Aadhar Card
2. Voter ID
3. Driving License
4. A utility bill provided that is no older than 2 months

• Passport-size Photograph

• Please provide your email ID and mobile phone number in order to verify your account.

• A video or biometric first stage of the identity check is possible depending on the company (according to the provider)

How to Apply for a DSC

• Choose a Certifying Authority:  One of eMudhra, Sify, NSDL(National Securities Depository Limited) or Capricorn is licensed, and you may choose any of these.

• Fill the DSC Application Form: Applicants may submit their DSC Application Form online or offline from the website of the respective CA.

• Upload Documents and Verification: Upload a copy of your ID and address. A few CAs will ask you to perform video KYC or use biometric checks.

• Make Payment: Payment needs to be made for DSCs which have a price range from ₹500 to ₹2000, according to their validity period.

• Download DSC: As soon as you are approved, the DSC will be available for you to store on a USB token (e-token) for later use.

Validity of DSC

• Most DSCs live somewhere between 1 and 3 years.

• After expiration, your certificate can be renewed by the same CA or by another provider.

Benefits of Using a DSC

• Offers a simple and fast process for filing and approving documents.

• No need to spend money on paper and courier services.

• Once you sign your document, you can be certain it won’t be altered.

• In India, the Information Technology Act of 2000 recognises electronic commerce.

• Easy on the environment because it cuts down on paper and ink.

Common Uses of DSC in Private Limited Companies

• Form SPICe+ for Company Incorporation

• Completing your Annual Returns forms and Financial Statements

• GST Registration and creating GST Return

• Lodging electronic MCA forms

• Getting involved in online tenders and government services

Conclusion

Besides being needed for compliance, a Digital Signature Certificate is now essential in the world of corporate governance. By using a DSC, private limited companies can operate seamlessly, meet legal standards and keep their digital systems secure. Having a valid DSC for all directors and authorised signatories will keep the company in compliance and help it interact smoothly with both the government and stakeholders online.

Disclaimer

The information provided in this blog is purely for general informational purposes only. While every effort has been made to ensure the accuracy, reliability and completeness of the content presented, we make no representations or warranties of any kind, express or implied, for the same. 

We expressly disclaim any and all liability for any loss, damage or injury arising from or in connection with the use of or reliance on this information. This includes, but is not limited to, any direct, indirect, incidental, consequential or punitive damage.

Further, we reserve the right to make changes to the content at any time without prior notice. For specific advice tailored to your situation, we request you to get in touch with us.