What is digital signature certificate?

Digital signature is a specific type of electronic signature (e-signature) that relies on public-key cryptography to support identity authentication and provide data and transaction integrity.
A Digital Signature is only a verification of any electronic record by a supporter of the report. Such a confirmation is finished by the method of an electronic technique or cycle as per Area 3 of The Data Innovation Act, 2000.
A digital signature certificate (DSC) is a safe digital key that certifies the identify of the holder. A certifying authority (CA) gives these certificates . Besides, the DSC includes recognizing data like an email address and an APNIC account name.

Eligibility for digital signature certificate

A licensed Certifying Authority (CA) issues the digital signature. Certifying Authority (CA) means a person who has been granted a license to issue a digital signature certificate under Section 24 of the Indian
The provisions with regards to the utilization of the Digital Signatures on documents submitted electronically are contained in the Data technology Act 2000. These arrangements are provided to lay out validness and security of the multitude of archives that are recorded carefully.
In this manner, every one of the records documented by organizations, LLPs that go under MCA 21 e-governance project need to document such archives utilizing advanced marks. Such a mark should be fastened by the individual who is approved to do as such.

Certifying Authorities for Issuance of a Digital Signature Certificate

The Controller of Certifying Authority for the purpose of issuing digital signatures in India has authorized eMudhra, Capricorn,Safe Scrypt, Vsign and more as the certifying authority for issuance of Digital Signature Certificate. Other certifying authorities may include (n) Code Solutions, National Informatics Centre, Safescrypt and Institute for Development and Research in Banking Technology.

Types of Digital Signature Tokens:

Each has its own level of security and is meant for a particular category of professional and or sector of industry
ePass2003 is a USB device used to store the digital signature certificate. It is based on a smart-card chip and is very easy to use and carry. ePass2003 can be installed on Windows, Mac and Linux operating systems.
Proxkey digital signature token is a hardware cryptographic token. The two-factor authentication of Proxykey makes it the most secure digital signature token. The public and private keys of Proxkey allows for a safe, smooth and easy signing process.
mToken is a plug and play digital signature token. By identifying the users' identity digitally, mToken helps to enhance digital security. It also allows users to perform cloud signing in a seamless manner.

Classes of DSC

The type of applicant and the purpose for which the Digital Signature Certificate is obtained defines the kind of DSC one must apply for depending on the need. There are three types of Digital Signature certificates issued by the certifying authorities.

  • Class 1 Certificates: These are issued to individual/private subscribers and are used to confirm that the user’s name and email contact details from the clearly defined subject lie within the database of the certifying authority.
  • Class 2 Certificates: These are issued to the director/signatory authorities of the companies for the purpose of e-filing with the Registrar of Companies (ROC). Class 2 certificate is mandatory for individuals who have to sign manual documents while filing returns with the ROC. However, from 01.01.2021, the Controller of Certifying Authority has instructed to discontinue Class 2 Certificates and Class 3 Certificates will be issued in place of Class 2 Certificates.
  • Class 3 Certificates: These certificates are used in online participation/bidding in e-auctions and online tenders anywhere in India. The vendors who wish to participate in the online tenders must have a Class 3 digital signature certificate.

Benefits of Digital Signatures

Time Saver: especially when the person is required to sign from a different place. Be it a tablet, phone, or computer, DSC can seamlessly ensure this otherwise tedious task is wrapped up in just a few minutes.

Security: When signing digitally, the signers identify themselves as it can provide evidence of origin, identity, and status of electronic documents, transactions, or digital messages. This acts as a trustworthy means of identification.

Happier end-users: Instead of physically visiting your branch, office, or store, they can sign from anywhere, on any device, and at their own pace. And besides resulting in faster turnarounds, this better experience translates into higher satisfaction. This results in benefiting you, your clients, partners, and stakeholders.

Legal validity: Digital signatures provide authenticity and verification. This can stand in any court of law like any other signed paper document. Time stamping and the ability to track and easily archive documents improve and simplify audit and compliance

Traceability: Digital signatures create an audit trail that makes internal record-keeping easier for businesses. With everything recorded and stored digitally, there are fewer opportunities for a manual signee or record-keeper to make a mistake or misplace something.

Data integrity: Documents that are signed digitally cannot be altered or edited after signing, which makes the data safe and secure. The government agencies often ask for these certificates to cross-check and verify the business transaction.

Why do we required DSC

DSC are mandatory as an authenticated signature tool on various govt. platforms. Some of the uses of DSC are:

  1. Company Incorporation
  2. Director Identification Number Application
  3. MCA Compliances
  4. Import Export Code
Recommended For Startups & Growing Companies Sole Promoters Professional Services Companies Small Businesses Firms Small Traders, Agents & Manufactures
Prevailing laws Companies Act Companies Act LLP Act Partnership Act NA
Charter Documents MOA & AOA MOA & AOA LLP Agreement Partnership Deed NA
Limit of Members 2-200 1 2-Unlimited 2-20 NA
Separate legal identity Yes Yes Yes NO NO
Limited Liability Yes Yes Yes NO NO

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Simplified Performa for Incorporating Company Electronically, also known as SPICe, was introduced in the year 2016 for the purpose of incorporation of the companies. Under the Ease of Doing Business (EODB) initiative, the MCA released the new form SPICe+ to further ease the company incorporation process. The new SPICe+ form encompasses more features than the earlier SPICe form. Name approval is integrated as part of the SPICe+ form.

After the introduction of the SPICe+ form, the name approval has been integrated with SPICe+. Part-A of SPICe+ is for name approval. Therefore, from 15th February 2020, the RUN form can only be used for a change of name.

Company Limited by Shares: The liability of the shareholders is limited only to the amount that is unpaid on the shares held by them. Company Limited by Guarantee: A company having no share capital where the liability of the shareholders is limited up to the amount undertaken to be contributed by them in the event of liquidation of the company.

Yes. private limited companies are eligible for attracting foreign direct investments in compliance with the relevant laws and regulations.

DIN, also known as Director Identification Number, is an identification number of a person intending or has become a director in a company. DPIN, also known as Designated Partner Identification Number, is an identification number for a designated partner in LLP. It is similar to DIN in the case of companies. DIN and DPIN are issued by the Ministry of Corporate Affairs.

Yes. Even a foreign national can become a director in a private limited company.

As per the Companies Act, 2013, only an individual natural person can become a director in a company. Therefore, neither a company, firm, or association can become a director in any company. This is to ensure the fixation of duties and responsibilities that would be difficult in the case of companies and firms becoming directors.

The private limited company registration cost depends upon various factors like authorized capital, number of directors, etc. Initiate your Pvt. Ltd. Company Registration with Trade Approvals as your partner in corporate compliance! Reach out to us for any professional assistance.