Companies Act, 2013 and Companies (Registration Offices and Fees) Rules, 2014 state that documents need to be authenticated by individuals or professionals, depending on the document. Section 21 of the Companies Act, 2013 states that a document, proceeding or contract requiring authentication on behalf of the company can be signed by an officer of the company or key managerial personnel on the company’s behalf.[i] This paper will look at the authentication of documents, proceedings and contracts required by companies. While authenticating these documents, the person authorized needs to follow certain rules and regulations.
An electronic form can be authenticated with a digital signature if the digital signature has been signed by someone authorized to do so.[ii] thus, a singular person can be authorized to do so, this can be any director authorized through a meeting and subsequently by passing a resolution. This authorization of the director should ideally be done during the first board meeting of the financial year, and while signing any such electronic forms, the director will have to mention the authorization number and the sating of the passing of the resolution which has authorized him to sign the form. Moreover, the director or any other person who has been authorized to sign such forms is generally authorized for the whole of the year, and therefore, it is better to pass such a resolution at the first board meeting of the financial year. The person who is signing a document, while filing a document through the portal of the central government or registrar is to contain the name, address, designation, membership number or director identification number.[iii]
If there is a form related to a change in secretaries, or directors of the company, the appointment form of the secretary or the director has to be filed by a continuing director, this can be anyone in case the appointment is of a director or secretary, or the secretary of the company also referred to as the company secretary if the appointment is of a director.[iv] Secretary means the company secretary under the Companies Act, 2013,[v] and their job is to ensure that the company is complying with all relevant legislation and regulations, and ensure that the board members are informed of all their legal responsibilities towards the company. Whenever there is a re-appointment, appointment, or change of director, then the same can be signed by the company secretary or a continuing director; if it is a reappointment of. Director, then the continuing director needs to be other than the one who is being reappointed. If there is a change in the company secretary, whether it is a reappointment, appointment or change then it needs to be signed by a continuing director.
Whether it is an authorized signatory or a professional who is responsible for signing the electronic form, it is their responsibility to ensure the correctness of the contents of the electronic form and all enclosures attached to the electronic form.[vi] A single mistake on their part can lead to penalties under the act and also a detriment to any contracts or arrangements being entered into through the form. Therefore, they need to be very careful with their work.
All people who have been authorized to authenticate any electronic forms, applications, documents and so on, which are to be delivered or filed under the Companies Act, 2013 or any rules related to the Companies Act, 2013, the authorized persons are responsible for attaining a digital signature certificate (DSC) from the certifying authority, allowing them to sign such documents.[vii] It authorizes their signatures, but the certificate needs to be at least CALSS II or class III under the Information Technology Act, of 2000. The digital signature certificate helps to prove someone’s identity, sign certain documents and access information or services on the net. Class II DSC is used to file documents with the registrar of companies, MCA forms, income tax returns, audit reports, and so on.[viii] Class III DSC is where the registration authority verifies the identity of the person, and these are required for fields where there is a high chance of fraud risks, high-value transactions, or threats to data.
The electronic form which needs to be filed under the Companies Act, 2013 or any of the relevant rules related to companies, is to be authenticated on behalf of the company by a director, secretary of the company, managing director, or any other key managerial personnel.[ix] Key managerial personnel includes, the chief executive officer or the managing director or the manager of the company; any whole-time director; the company secretary; the chief financial officer; and any other prescribed officer.[x]
If the document has been scanned, then the scanned image of the document should be of the original signed documents which are relevant to the electronic form, documents, and so on.[xi] The scanned document should not be without the signature of the authorized person. Al such documents should be clear and visible, without any blank papers. No scanned sign should have been used. The document should have been originally signed and then scanned.
It is the sole responsibility of the authorized person, whether an officer of the company or a hired professional, responsible for signing the forms to ensure that all the required attachments which are relevant to the form have been attached properly and are completely legible, and are following all relevant guidelines of the document as stipulated in the Companies Act, 2013 and other relevant rules applicable to companies.[xii] They should also ensure that there has been no omission of facts.
The documents, application, or form can contain a power of attorney which has been issued to a professional, such as a chartered accountant, advocate, cost accountant or company secretary in whole-time practice or any other person supported by the board of directors and is approved by a resolution to make representation on behalf of the company, as an approving or registering authority.[xiii] If they fail to fulfil their duties, or the company does not pass a resolution or power of attorney is not given, then key managerial personnel or director can make the representation.
Suppose any misleading information has been filed or there has been an omission in filing a document, application or return. In that case, the person can be held liable under section 448 or 449 of the Companies Act, 2013.[xiv] Moreover, the central government will also de-activate the DSC until a final decision about the matter has been adjudicated.[xv] Certain forms need to be pre-certified by the company secretary, chartered accountant, or cost accountant in whole-time practice.[xvi] Anyone who provides false information to the registrar of companies on behalf of the company is liable to be prosecuted under section 448 of the Companies Act, 2013.[xvii] However, for a case to be brought under section 448 there needs to be clear record as to fraud or suppression or omission of material facts.[xviii] If any person intentionally provides false information, then they can be held liable under section 449 of the Companies Act, 2013.[xix]
The government is responsible for maintaining a website or portal for filing of electronic forms, applications, or documents for viewing and inspection, or for obtaining certified copies whenever necessary.[xx] Authentication of documents, proceedings and contracts is a very important task, which if not undertaken properly can put the entire company in jeopardy, moreover, it can put the person in-charge in trouble with the government as well. Therefore, these positions generally go to the key managerial positions or other professionals vetted by a board resolution, as this job requires application of mind as well as a high amount of responsibility and discretion.
[i] Companies Act, 2013, Section 21;
Messers Paras Traders & Ors. v. Fullerton India Credit Company Limited, Decided February 22, 2021.
[ii] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(1).
[iii] Companies (Registration Offices and Fees) Rules, 2014, Rule 7.
[iv] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(2).
[v] Companies Act, 2013, Section 2(1)(c).
[vi] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(3).
[vii] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(4).
[viii] Anonymous, ‘No more Class II Digital Signature from 2021?,’ (ClearTax, October 2021), < https://cleartax.in/s/no-class-2-digital-signature-2021>, accessed 18th October 2022.
[ix] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(5).
[x] Companies Act, 2013, Section 2(51).
[xi] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(6).
[xii] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(7).
[xiii] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(8).
[xiv] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(9).
[xv] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(10).
[xvi] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(12).
[xvii] Vijay Kumar Gupta v. Registrar of Companies, (2004) 118 CompCas 604 (HP): (2003) CLC 777 (HP).
[xviii] Deva Jaya Thanga Thambi v. Deputy Registrar of Companies,  136 (Madras).
[xix] Companies Act, 2013, section 449.
[xx] Companies (Registration Offices and Fees) Rules, 2014, Rule 8(11).
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