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Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether the impugned disqualification and consequential denial of reappointment as director could be sustained in view of the binding Division Bench decision on disqualification of directors and deactivation of Director Identification Numbers.
Analysis: The order follows the earlier Division Bench ruling which held that the Companies (Appointment and Qualifications of Directors) Rules, 2014 do not authorise deactivation of the Director Identification Number upon disqualification under Section 164(2) of the Companies Act, 2013, and that such deactivation is inconsistent with Section 167(1) in the context of continued directorship of the defaulting company. The present petitions were decided on the same basis as the earlier ruling, with no independent ground shown to depart from it.
Conclusion: The challenge succeeds and the writ petitions are allowed in favour of the petitioners.
Final Conclusion: The impugned action could not be sustained and the petitioners obtained the relief sought, subject to the legal position governing future action by the Registrar of Companies.
Ratio Decidendi: Disqualification under Section 164(2) of the Companies Act, 2013 does not, by itself, authorise deactivation of the Director Identification Number under the Companies (Appointment and Qualifications of Directors) Rules, 2014, and the competent authority must act within the confines of the statutory scheme.
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