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2022 (10) TMI 643 - HC - Companies LawDisqualification of Director under section 164(2) of the Companies Act, 2013 - HELD THAT:- From the perusal of the Act of 2013 and Rules of 2014, it appears that Section 152 of the Act of 2013 deals in respect of Appointment of Director whereas Section 153 is in respect of Application for allotment of DIN and Section 154 is in respect of Allotment of DIN. It is pertinent to mention here that as per Section 152(3), allotment of DIN under Section 154 ( or any other number as may be prescribed under Section 153) is a prerequisite for appointment as director of a company. From perusal of said rule, it appears that cancellation or deactivation of DIN can be done at the instance of any person while moving an application along with fee as specified in the Rules of 2014 and that too after affording of opportunity of hearing (if cancellation or deactivation of DIN is made pursuant to clause (b) of sub-rule 1 of rule 11) - Here, prima facie no application has been moved by any person to reach to a conclusion regarding cancellation or deactivation of DIN at the hands of Registrar. In Rules, incorporation of requirement of moving application is obvious, because allotment of DIN number is prerequisite for appointment of directors, therefore, moving application by person assumes more significance because it is identity which is carried by the director over his shoulder during his stint as director of the company, therefore, such important identification cannot be sacrificed suo motu or at the instance of any misrepresentation. It needs verification of e-record and affording opportunity of hearing in some contingencies especially when the matter pertains to obtaining DIN in a Wrongful Manner or by Fraudulent Means. So far as application of Sections 164 and 167 of the Act of 2013 is concerned from the Act of 2013 itself it appears that Section 164 of the Act of 2013 was made applicable from 1st May, 2014 whereas Section 167 of the Act of 2013 was made applicable w.e.f. 7th May, 2018 and it is settled in lay that unless statute is made applicable retrospectively, its application would be prospective in nature. In some of the cases, alleged default appears to be of 2015-16 and 2016-17, therefore, three consecutive years have not been lapsed so as to attract the liability or rigours of Section 164(2) of the Act of 2013. Different High Courts have taken same stand that DIN cannot be cancelled or deactivated resorting to Section 164 or 167 of the Act of 2013 and for the reasons assigned into their orders - looking to the legal position and the judgments passed by different High Courts from time to time, this Court intends to allow the writ petitions preferred by petitioners and set aside the impugned orders passed by Registrar of Companies against the petitioners whereby DIN has been cancelled/deactivated - Petition allowed.
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