DSC vs eSign vs EVC: Which Electronic Signature Do You Need for Each Filing?

There are three common ways to sign or verify something online in India: a Digital Signature Certificate (DSC), Aadhaar-based eSign, and an electronic verification code (EVC). They're often confused, and they aren't interchangeable. Some filings accept any of them; others insist on a DSC. This guide explains the difference and which one to use where.

The Three Options

Digital Signature Certificate (DSC)

A DSC is a certificate issued by a Certifying Authority licensed by the Controller of Certifying Authorities under the Information Technology Act, 2000. Since Class 2 certificates were discontinued in 2021, a Class 3 certificate is the standard. It's usually stored on a USB token and protected by a password, and it lasts one to three years. You can sign as many documents as you like until it expires.

Aadhaar eSign

eSign is a one-time electronic signature. You verify yourself with an OTP sent to your Aadhaar-linked mobile number, and an eSign service provider creates a signature for that one document. There's no token and nothing to buy in advance, but each signature is separate. It's legally recognised under the IT Act.

Electronic Verification Code (EVC)

An EVC isn't really a signature. It's a code, such as an OTP, that a portal uses to confirm it's really you submitting a return or form. The income tax and GST portals use EVCs to verify filings by people and businesses that don't have to use a DSC.

Which One Each Filing Needs

• MCA filings: a DSC is needed to sign company and LLP forms, including incorporation, annual filings and DIR-3 KYC. eSign and EVC aren't accepted for these.
• Income tax returns: companies must use a DSC. Individuals and most others can e-verify with Aadhaar OTP, net banking or another EVC. Tax audit reports are signed with the auditor's DSC.
• GST: companies and LLPs generally need a DSC for applications and returns. Other taxpayers can use an EVC.
• EPFO: employers use a DSC registered on the employer portal for approvals such as employees' KYC.
• Government tenders: e-procurement portals usually need a Class 3 DSC, often with both signing and encryption certificates.
• Contracts and other documents: eSign or a DSC both work for most agreements, offer letters and similar documents.

What Can't Be Signed Electronically

The IT Act excludes some documents from electronic signing altogether, whichever method you use. These include negotiable instruments other than cheques, powers of attorney, trust deeds, wills, and contracts for the sale or conveyance of immovable property. These still need to be signed on paper, and often stamped and registered.

How to Choose

• If you're a director, designated partner or authorised signatory of a company or LLP, get a DSC. You'll need it for MCA and tax filings anyway.
• If you bid for government tenders, get a Class 3 DSC with signing and encryption.
• If you only need to sign the occasional agreement, eSign is simpler and cheaper.
• If you're an individual filing your own income tax return, an EVC through Aadhaar OTP or net banking is usually enough.

Common Mistakes

• Buying a DSC when only eSign or EVC is needed, or relying on eSign for a filing that needs a DSC.
• Letting a DSC expire just before an important filing deadline.
• Using someone else's DSC to sign. A DSC is personal, and you're responsible for anything signed with it.
• Assuming a document can be signed electronically when the law excludes it.

Getting Help

Think Filing helps you work out which kind of signature you need, gets DSCs issued and registered, and handles the filings that need them.

Sources

• Information Technology Act, 2000, including its First and Second Schedules.
• Rules and guidelines of the Controller of Certifying Authorities.
• MCA, income tax and GST portal guidance on signing and verification.