The Companies Act, 2013 (the Act) does not explicitly define a foreign resident/foreigner. An Indian citizen, as well as foreigner, may be treated like a foreign resident if he or she has not been staying in India for 12 months continuously immediately preceding the date of his or her appointment as a director. (Schedule V).
However, the period of 182 days stay in India is relevant to call a person resident or non-resident. If a person has stayed in India for 182 days in the immediately preceding year he shall be called a resident. A foreign citizen staying in India for 12 months may enjoy all rights under the Act but the same rights are not available to a Non-resident Indian (NRI) citizen.
1. As per 266A of the Companies Act, every individual, who wants to be appointed as director of a company should apply for a Director Identification Number (DIN) to the Registrar of Companies (ROC) in the prescribed DIN Form [DIN-I form]. If such a director happens to be a foreign national, details of a valid passport should be provided in form DIN-1 and a certified copy of the passport should be attached with DIN application. All supporting documents including photograph should be certified by the Indian Embassy or a notary in the home country of the applicant. It may also be certified by the Managing Director / CEO / Company Secretary of the company registered in India, in which the foreigner is a director. In case the foreign director has a valid multiple-entry Indian visa or PIO card or OCI card, then he could also get it attested by Public Notary / Gazetted Officer in India or practicing Chartered accountant or company secretary in practice.
The term ‘Resident’ is a person who has been staying in India for a continuous period that is not less than 12 months preceding the date of appointment. It also says that the purpose of coming to India must be either for taking up any employment in India or (2) for carrying on a business /vocation in India.