Delhi HC orders reactivation of DIN/DSC of directors of defaulting Cos. to allow them to start a new business
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Case details: ANANT NARAIN v. Union of India - [2021] 127 taxmann.com 895 (Delhi)
Judiciary and Counsel Details
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- Prathiba M. Singh, J.
- Varun Jain, Adv. for the Petitioner
- Manik Dogra, Adv. for the Respondent.
Facts of the Case
In the instant case, the Petitioners were directors in M/s. Innowin Info Solutions Private Limited, which company was struck off due to non-filing of the company’s financial statements or annual returns for a continuous period of three financial years. As a result, the Petitioners were disqualified and their Director Identification Number (hereinafter, “DIN”) and Digital Signature Certificate (hereinafter, “DSC”) were also deactivated. Now Petitioners wished to start a new business and, prayed for reactivation of their DIN/DSC
In the meantime, the Companies Fresh Start Scheme (CFSS-2020) has been introduced in view of the COVID-19 pandemic with the aim to enable a fresh start to default companies and directors of such companies.
High Court Held
Under this scheme, directors of struck off companies who seek to be appointed as directors of other/new companies, ought to be provided with an opportunity to avail of this scheme, provided that they have undergone a substantial period of their disqualification. The scheme seeks to provide a fresh start for directors of defaulting companies who seek appointments in other companies or wish to start new businesses.
Since petitioners were disqualified directors of struck off companies seeking appointment as directors in other/new companies, their DIN/DSC ought to be reactivated to enable them to conduct their fresh/new business in accordance with law
List of Cases Referred to
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- Mukut Pathak v. Union of India [2019] 111 taxmann.com 41 (Delhi) (para 3)
- Sandeep Agarwal v. Union of India [W.P. (C) No. 5490 of 2020, dated 2-9-2020] (para 3)
- Radhika Byrne v. Union of India[W.P. (C) No. 5534 of 2020, dated 28-12-2020] (para 3)
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