Director Identification Number deactivation is impermissible for disqualified directors where the statutory scheme requires DIN retention to cure default.

A Division Bench ruling under Sections 164(2)(a) and 167(1) of the Companies Act, 2013, read with the 2014 Rules, held that the Registrar of Companies has no power to deactivate a Director Identification Number merely because a director is disqualified. The court reasoned that such deactivation is inconsistent with the statutory scheme, because a continuing director of the defaulting company must retain the DIN to regularise filings and cure the default. Applying that binding precedent, the Madras HC allowed the petitions and held that the disqualification-related action could not stand against the petitioners.

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Issues: Whether the petitioners, whose names were included in the list of disqualified directors, were entitled to have the disqualification-related action interfered with and to be permitted to continue or resume acting as directors without deactivation of their Director Identification Numbers.

Analysis: The relief was governed by the earlier Division Bench decision which had examined the effect of Section 164(2)(a) and Section 167(1) of the Companies Act, 2013 together with the Companies (Appointment and Qualifications of Directors) Rules, 2014. That decision held that the Rules do not empower the Registrar of Companies to deactivate a Director Identification Number merely because a director stands disqualified, and that such deactivation is inconsistent with the statutory scheme since a continuing director of the defaulting company must retain the DIN to regularise filings and address the default.

Conclusion: The petitions were allowed in line with the binding earlier decision, and the impugned disqualification-related action could not stand insofar as the petitioners were concerned.

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