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In this blog will Discuss what is Digital signature certificate & its importance in detail.
What is Digital Signature Certificate?
- A Digital Signature Certificate (DSC) is a secure digital key that certifies the identity of the holder, issued by a Certifying Authority (CA).
- It typically contains your identity (Name, email, country, APNIC account name and your public key).
- Digital Certificates use Public Key Infrastructure meaning data that has been digitally signed or encrypted by a private key can only be decrypted by its corresponding public key.
- A digital certificate is an electronic “credit card” that establishes your credentials when doing business or other transactions on the Web.
- Class 2 and Class 3 Digital Signature Certificate (DSC) along with digital signatures for specific needs such as GST Registration, Income Tax filing, MCA, e-tendering, e-procurement and Foreign Trade.
Types of Digital Signature Certificate
Type 1: Class 2 DSC
Type 2: Class 3 DSC
- As e-filing is made compulsory in ROC, GST Registration, and every director/signing authority needs to have their Digital Signature Certificate.
- It’s now mandatory to obtain Class-2 or Class-2 with PAN Encryption Digital Signature Certificate for any person who is required to sign manual documents and returns filed with ROC.
- An Individual is required to obtain Class-2 DSC with PAN Encryption for e-filing his/her return with Income Tax Return via Income tax India e-filing website.
- Accounts officers want Digital Signature Certificate (DSC) to sign Form 16 /Form 16A of employees & Vendors, which will help Accounts officer to save their Time & avoid Manually signing of Documents.
- Class 3 Digital Signature Certificate is the High-end / Upgraded version of Class 2 Digital Signature Certificate.
- By Using This Certificate you can Participate / Bid in Any Kind of Online Tenders / Auction across India.
- To participate in the e-tendering process, every vendor is required to use a Class 3 Digital Signatures Certificate.
When Digital Signature certificates (DSC) required?
- GST Registration
- MCA e-filing
- Income Tax filing
- Foreign Trade
- Employees Provident Fund Organization
Now will Discuss one by one in detail…
1. GST Registration
- In order to register your company in the GST portal, you should have a valid Digital signature certificate of Responsible person (Class 2 Category).
- If it is proprietor concern, the digital signature of Proprietor is required.
- This is mandatory.
2. Ministry of Corporate Affairs (MCA)
- Any organization or firm can apply for a Digital Signature Certificate (DSC) for transactions involving the Ministry of Corporate Affairs. Anyhow, business exceeds revenues of over INR 60 lakhs have to mandatorily use a Digital Signature Certificate while filing returns.
- A Class 2 Digital Signature Certificate is available for download after verification based on a trusted and pre-verified database.
- A Class 3 Digital Signature Certificate, on the other hand, is of a higher level as it is issued only after the registrant’s identity verification has been done by a Registration Authority.
3. E-Filing of Income Tax Returns
- A Digital Signature Certificate lets you file your Tax Returns easier, fast and more secure.
- Use of a Digital Signature Certificate is mandatory for e-filing by a certain section of businesses, families, and individuals.
- A Digital Signature Certificate assures greater convenience while filing tax returns, and greater security during any electronic transactions.
4. Foreign Trade
- A Class 3 Digital Signature Certificate is essential for any organization seeking an Import or an Export Licence that needs to be registered in the name of one representative authorized to represent the organization.
- Since a Digital Signature Certificate is recognized by the legal system, all documents submitted using a Digital Signature Certificate is considered on par with physically signed documents, and also attract benefits.
- A Digital Signature Certificate (DSC) is essential for companies and organizations that take part or intend to take part in e-Tendering processes on various Government sites.
- Besides enabling eTendering which is extremely convenient and transparent, a Digital Signature Certificate also ensures greater security in other online transactions.
5. E-Tendering / E-Procurement
- E-Procurement facilitates, integrates, and streamlines procurement processes, a Digital Signature Certificate is essential for all e-Procurement processes.
- Applying for a government tender online has many advantages. Since documents are uploaded to a central site, acknowledgments and receipts are provided immediately. Which is not the case with paper documents that need to be scanned and verified before being processed.
- E-Procurement has gained significant popularity and acceptance as it brings greater transparency to the whole system because of Digital signature certificates.
- Any organization that is looking to apply for any Government eTender needs to have a Class 3 Digital Signature Certificate registered in the name of a representative who is authorized to submit online offers for e-Tendering applications.
6. EPFO (Employees Provident Fund Organisation)
- EPFO (Employees Provident Fund Organisation) has introduced online transfer claims which require Class 2 Digital Signature Certificates or above. This has made the transfer process transparent and efficient.
- Members can now submit his/her claim through a present or previous employer. At least one authorized person of the organization interacting with EPFO is required to have a valid Digital Signature Certificate for online submissions
- Class 2 or Class 3 Digital Signature Certificates helps to submit their employee PF transfer claim form online.
- Digital signature certificates make your work easier, convenient and cost saving in handling your employee PF transfer claim forms.
- Now the authorized signatories of employer’s can digitally sign using digital signature certificates and submit the form online in Employer Online Transfer Claim Portal.
Hope, From the above explanation you’ve got some useful information about Digital Signature Certificates (DSC), its uses & Its importance.
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Author: SRINIVASAN VENKATESH
The author is a Digital marketer & also worked as a TDS (Tax Deducted at Source) Operations Manager, He has more than 4 years of Experience in TDS Processing & Uploading, also has experience on TDS Default Clearance which raised by Income Tax Department (Reflected in TRACES).
He was also handled a Project of “Entire Employees PAN Database Error identification & Rectification” for Murugappa Group (Various units like EID Parry (India) Ltd, Parry Agro Industries Ltd, Murugappa Holdings Ltd etc.., ), Which helped them to avoid huge Tax Defaults & due to this project the company saved a lot of amount.
He worked as a TDS Consultant in the PVT Firm in Bangalore, Handled Corporate Clients Like South Western Railway (Bangalore Division), Karnataka Traffic Police (Bangalore Division), Karnataka Power Corp (KPTCL), Bangalore Electricity Company (BESCOM), Gulburga Electricity Company (GESCOM) Mphasis, Axiss Dental, LifeStyle International, State Bank of India, UCO Bank, Food Corporation of India (Chennai & Bangalore), Life Insurance Corporations & Govt Institutions in Karnataka & Tamil nadu.
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