Digital Signatures

What is Digital Signature Certificate?

Digital Signature Certificates (DSC) are the digital equivalent (that is electronic format) of physical or paper certificates. Few Examples of physical certificates are drivers' licenses, passports or membership cards. A digital certificate can be presented electronically to prove one’s identity, to access information or services on the Internet or to sign certain documents digitally.

A Digital Signature Certificate is a secure digital key that is issued by the certifying authorities for the purpose of validating and certifying the identity of the person holding this certificate.

A digital signature certificate (DSC) contains information about the user’s name, pin code, country, email address, date of issuance of certificate and name of the certifying authority.

Why is Digital Signature Certificate is required?

Physical documents are signed manually, similarly, electronic documents and returns (e.g. MCA eForms, GST Returns, MCA Returns, various online applications etc.) are required to be signed digitally using a Digital Signature Certificate.

Types of Digital Signature Certificates (DSCs)

What are different classes of Digital Signature Certificates (DSCs)?

1. Class 1 Certificates

The Class 1 Digital Signature certificates are issued for both business personnel and private individuals use. Such certificates assure that the information in the application given by the subscriber does not conflict with the information in well-recognized consumer databases. The verification requirements for these certificates include:

(i) Aadhaar eKYC Biometric,

(ii) paper based application form and supporting documents or,

(iii) Aadhaar eKYC OTP + Video Verification. The Private Key generation and storage could be in software.

2. 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.

3. Class 3 Certificates

This certificate is issued to individuals and organizations. Unlike Class 1 certificates, class 3 digital signatures certificates are applicable in environments with significant risks. However, Class 3 Digital Signature Certificate is applicable to environments where threats to data and consequences of failure of security services are high, for instance, high value transactions or high levels of fraud risk.

The verification requirements for class 3 certificate are :

(i) Aadhaar eKYC Biometric,

(ii) Paper based application form and supporting documents and (physical personal appearance before CA or Video verification) or

(iii) Aadhaar eKYC OTP + Video Verification. The Aadhaar eKYC OTP and Aadhaar eKYC Biometric are the verification requirements.

Benefits of Digital Signature Certificate

1. Saves time

Digital signatures ensure that businesses save on cost and time with documents and contracts signed off with a click of a button. There are huge savings in cost and time especially when the person required to sign is in a geographically different area. Documents can be signed off almost instantly, from anywhere.

2. Security

When it comes to signatures, authenticity, and security are a priority. Digital signatures reduce the risk of duplication or alteration of the document itself. Digital signatures ensure that signatures are verified, authentic and legitimate.

3. Legal validity

Digital signatures provides authenticity and ensures that the signature is verified. This can stand in any court of law like any other signed paper document. Time stamping and ability to track and easily archive documents improve and simplify audit and compliance.

4. 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.

Form size is increasing after attaching DSC