Appointment of an NRI Director in an Indian Company- Documents required and Step wise process of appointing an NRI Director

India is continuously proving to be the favourite spot for investment for Foreigners and NRIs, that is the reason that India has seen a steady in flow of global companies coming to India, set up their business and expand their operations in India. The Indian Subsidiaries Both the new as well as existing Indian subsidiaries of foreign companies tend to depute trusted foreign personnel/non-resident Indians (NRIs) employed with them as their representatives in India in the form of directors or other key managerial personnel. In this article we have discussed about an Appointment of an NRI Director in an Indian Company. Find out the documents required and step wise process to appoint an NRI Director.

In India Company Registration becomes a bit easy when it is Incorporated with an NRI Director.

Documents required for the appointment of an NRI Director

• Photographs NRI director
• Passport of the NRI director
• Notarized copy of address proof (latest Telephone, Electricity Bill, Bank Statement) of NRI director
• Pan Card, if any
• Adhaar Card, if any
• Consent to act as director in form DIR-2
• Copy of resolution passed by the shareholders
• Notice for shareholders meeting

Note: For the Appointment of an NRI as a director in an Indian Company or for company incorporation in India with an NRI director, all the documents need to be self attested. Also, the documents needs to be either appostile or notarized

The Process of appointment of NRI Director in Indian Company

Consent of the Director in Form DIR 2  

• The first step towards appointing an NRI Director in a company is to take consent of the proposed NRI Director.
• The Consent of the proposed director to act as a Director in Indian company shall be filed in Form DIR 2 with all the necessary Documents.

Apply DSC and DIN of proposed Director  

• The next step would be to appy for Digital Signature Certificate (DSC) and DIN of the proposed Director of the Company. As far as DSC is concerned if he does not have the DSC, He shall obtain the DSC from the certifying authorities of India.
• While the Director Identification Number is concerned, if the NRI Director does not have the DIN, the first thing he needs to do is to inform the company about the same.
• Then the company shall pass a resolution regarding the same and apply for the DIN of the proposed Director in form DIR 3.
• The company shall file DIR 3 KYC with all the necessary KYC documents.
• The DIN so allotted shall be once only for the lifetime of the Director.

Call for a Board Meeting and EGM  

• The appointment of the director shall be made in a general meeting of the company.
• In this regard, the company shall issue notice to all the shareholders of the company informing them about holding an Extra Ordinary General Meeting of the company.
• Once the notice to call for EGM is issued to all the shareholder, the next step shall be to hold the meeting on the decided date and time and pass all the necessary resolution for the Director’s Appointment of Director in the Company.

Issue letter of Appointment of an NRI Director

• After passing the resolution, the next step would be to issue letter of appointment to the NRI Director of the company.
• The Appointment letter must mention terms and conditions of the appointment of the NRI Director including the salary to be payable to him.

File Form DIR-12 to ROC  

• Once all the necessary steps are completed, the company should file Form DIR 12 to Registrar of Companies within 30 days from the date of appointment of the Director along with all the necessary documents.

Conclusion

When an NRI is involved in Incorporation of an Indian company he can act as Resident Director of the Company provided he has stayed in India for more than 182 days in the previous calendar year.

Beneficial Read: Benefits of investing in India- from an NRI and Foreigner’s perspective