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Digital signature is a technique used to validate the authenticity of a digital document. It provides more credibility to digital communications. A digital signature is defined and dealt with under Sections 2, 3 and 15 of the Information Technology Act. Section 2(1)(p) of the Information Technology Act defines Digital Signature as, “mean authentication of any electronic record by a subscriber by means of an electronic method or procedure in accordance with the provisions of Section 3”. In order to obtain a Digital Signature Certificate, there are certain procedures that need to be followed.

What do you require to apply for a Digital Signature Certificate

The following are the requirements to apply for a digital signature certificate: 

1. Fill Form: Duly filled application form for Digital Signature Certificate

2. Photo ID Proof: This can include one’s driving license, PAN card, Aadhaar card etc.

3. Address Proof: Typically, phone bill, electricity bill, rent/sale agreements etc. are accepted as address proof.

Types of Digital Signature Certificate

Class 1 Certificates: These certificates are issued to private as well as individual subscribers. These certificates are issued to ensure that the user’s name, email address and other details provided are true and within the database of the Certifying Authority

Class 2 Certificates: These certificates are issued to the director or the signatory authorities of the companies. The main purpose of issuing these certificates is for the E-filing of the Registrar of Companies. Individuals who sign all the documents manually and file the returns with the Registrar of Companies, must mandatorily have Class 2 certificates.

Class 3 Certificates: These certificates are used for online participation or for people bidding in e-auctions or any online tenders across India. Class 3 certificates are mandatory for all the vendors who wish to participate in online tenders.   

Procedure for obtaining a Digital Signature Certificate 

The following steps need to be followed in order to obtain a Digital Signature Certificate:

Log-in to the Certifying Authority’s website: Not anyone and everyone can issue Digital Certificates. There is a list of Certifying Authorities that are licensed to issue Digital Certificates. This list is available on the MCA website and includes authorities such as the NSDL, E-Mudhra etc. In order to obtain a Digital Signature Certificate, one must log on to the site of the Certified Authority and visit the Digital Certification Services section and choose the type of form. For example, whether you want to obtain a digital signature certificate for an individual or an organization, and accordingly one must download the form.  

Fill necessary details: Upon receiving the form, the person must fill correctly all the required details. Some of the details asked are class of digital certificates, validity, contact details, residential address, type of digital certificates, GST number if applying for the organization, declaration etc. After filling the form, one must recheck the information provided and thereafter take a printout of the form and preserve the copy of it. 

Provide the required proofs: The residential proof and ID proof attached to the form must be attested by an officer. It must be ensured that the sign and seal of the officer is clearly visible so as to avoid any obstruction in the procedure further.

Make the payment: The payment must be made in order to acquire the Digital Signature Certificate either by cheque or by Demand Draft in the name of the Local Registration Authority. The details of the Local Registration Authority differ from the person’s city of residence, and such details can be obtained by searching the appropriate certifying authorities licensed to issue Digital Signature Certificate.

Send a hard copy of the form to the Local Registration Authority: After filling the form, one must send in an enclosed envelope the following documents to the Local Registration Authority-:

1. Duly filled application form,

2. Attested copies of the Residential Proof and ID Proof, and 

3. Demand Draft or Cheque 

Conclusion

A digital signature certificate is extremely important at times of incorporation and during all compliance stages. Having a valid digital signature, makes authentication of electronic records easy and faster.

A sole proprietorship is the simplest form of company formation. In this form of business incorporation, you set up a business solely on your own. Sole proprietorship business is not separate from the owner, i.e., it does not have a separate legal identity of its own. The personal income tax return of the owner is used to file taxes for the business as well. In this form of business, a person alone is liable to pay the debts, if any, and enjoy the profits earned. A sole proprietorship is the preferred form of business for professionals such as consultants, lawyers, etc. Its popularity stems from factors such as simple to set up, low cost of formation, etc.

How is a Sole Proprietorship Business set up?

It is easy to form a sole proprietorship company. Since the entire business is done on the name of the owner itself, there is less paperwork to be done while setting up this kind of business. It is a hassle-free form of business. Any person who wishes to start a business that is not so complex, he/she may consider the Sole Proprietorship form of business. 

The following steps must be followed to form a Sole Proprietorship business:-

1. Select a name and register your business: Name selected for business by a person can be any, but one must ensure that the name chosen must not be registered by others. After selecting a name, the person must register the name, if possible, the person must get the name trademarked. 
2. Finding an appropriate location for the business: A person must decide whether he wants to do the business from home or at rent or purchase an office. If a person decides to work from home, then there's no need for finding an apt place for setting up a business. However, if a person is not opting for work from home, then he/she must find a suitable location for its business. If a person has set up a business premise, then it must be registered under the Shop and Establishment Act. 
3. Apply for GST Registration: If the business is engaged in the sale of goods or services, it must apply for GST registration number. GST registration can be applied by providing certain documents such as Aadhar Card, PAN Card, and self-attested copies of the above documents. 
4. Open a Current Bank Account: Most important is to open a current bank account. The person must open a separate current account in the name of the owner or business in order to avoid any mixing of the expenditure made for personal purposes or business purposes. 

Advantages of Sole Proprietorship

1. The most important advantage of a sole proprietorship is its simplicity and that it is easy to establish and has a hassle-free process of establishment. 
2. The owner himself enjoys all the profits earned. However, when there is a loss, he alone is liable to pay all the debts. 
3. The person who sets up a sole proprietorship business he alone has authority over the entire business. He himself makes plans, invests money, supervises the business, enjoys profits.
4. A sole proprietor and his business are not a separate legal entity, but it is one. Therefore, all the assets, liabilities, profits, and losses on the part of the owner. 
5. In a sole proprietorship, the trader is taxed on the personal income of the owner, i.e., the tax is levied on the profits earned by the owner. Like other forms of business, the sole proprietor need not pay any other form of tax. 
6. The sole proprietor can work for as long as he wishes, he may even sell it when is wishes, or may pass on to its heirs. 

Disadvantages of Sole Proprietorship 

1. The owners are fully liable, i.e., if the owner fails to pay the debts, then the owner's personal property such as home, personal savings can be taken away to pay the debts. 
2. The main disadvantage of a sole proprietorship is that it is difficult to expand the business due to factors such as lack of resources, lack of staff, and many more
3. In the absence of a sole proprietor, the business can go haywire, i.e., it can cause huge losses if it is not managed aptly. 

Conclusion

A sole proprietorship is the best way to start a business if you have no funding, and you want to test your product in the market. It entails little liability and compliance while setting up a new business and creating a brand name for your product.