Development in Company Law

DIRECTOR IDENTIFICATION NUMBER (DIN)

• Director Identification Number (DIN) is a unique 8-digit number that is allotted by Central Government to the individuals who intend to become a director in a company or who already are directors of company.

• DIN once allotted is valid for lifetime of a director until cancelled, surrendered or deactivated.

• With the DIN number government also maintain a database of the entire director. An individual can have just one DIN but he are often the director of two or more companies.

• Application for allotment of DIN (Sec 153): Every individual intending to be appointed as director of a company shall make an application for allotment of Director Identification Number to the Central Government in such form and manner and along side such fees as could also be prescribed.

• Director to Intimate DIN (Sec 156): Every existing director shall, within one month of the receipt of Director Identification Number from the Central Government, intimate his Director Identification Number to the company or all companies wherein he is a director.

• Company to Inform DIN to Registrar (Sec 157): After receiving DIN from the director the company respected company has to intimate about the DIN of the director to the Registrar of Company within 15 days.

• Obligation to Indicate Director Identification Number (Sec 158): DIN number (MCA) is always mentioned underneath the signature of the Director, whenever an important document, Information letter or a return will be submitted under any law.

• Penalty (Sec 159): If any director of a company, contravenes any of the provisions of Sec 155 and 156, such director of the company shall be punishable with imprisonment for a term which can reach six months or with fine which can reach fifty thousand rupees and where the contravention may be a continuing one, with an extra fine which can reach five hundred rupees for each day after the primary during which the contravention continues.

CORPORATE IDENTIFICATION NUMBER (CIN)

• Corporate identity number or CIN is a unique 21 digit registration number which each and every company gets after getting registered with ministry of corporate affairs.

• This is a mandatory requirement of Section 12 of new Companies Act 2013 regarding quoting of company’s Corporate identity number or CIN in letter heads and other official publications.

• As per section 12 (3) (c) of new companies act 2013, every company shall get its name, address of its registered office and the Corporate identity number or CIN along with phone number , fax number, if any, email address and website address, if any, printed altogether its letter , billheads, letter papers and altogether its notices and other official publications.

• Decoding the CIN number.

INSIDERS TRADING

When insiders, e.g. key employees or executives who have access to the strategic information about the corporate , use an equivalent for trading within the company’s stocks or securities, it’s called trading . To be accused of trading , you want to usually be someone who features a legal duty to a different person, institution, corporation, partnership, firm, or entity. The rationale behind the prohibition of trading is “the obvious need and understandable concern about the damage to public confidence which insider dealing is probably going to cause and the clear intention to stop , thus far as possible, what amounts to cheating when those with inside knowledge use that knowledge to form a profit in their dealings with others.

Section 195 of Companies Act,2013 which prohibits insider trading defines it as,an act of subscribing, buying, selling, dealing or agreeing to subscribe, buy, sell or deal in any securities by any director or key managerial personnel or the other officer of a corporation either as principal or agent if such director or key managerial personnel or the other officer of the company is fairly expected to possess access to any non-public price sensitive information in respect of securities of company; or an act of counselling about procuring or communicating directly or indirectly any non-public price-sensitive information to any person; Price-sensitive information means any information which relates, directly or indirectly, to a company and which if published is likely to materially affect the price of securities of the company. Section 195 of the businesses Act, 2013 states that no director or managerial personnel of the corporate should enter into trading of securities.

Any contravention of section 195 will cause imprisonment for a term of 5 (5) Years or with fine of minimum of Rs. 5 Lakhs to maximum of Rs. 25 Crores or 3 times the amount of profit made out of insider trading whichever is higher.

Aishwarya Says:

I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.

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