How Foreign Companies Can Appoint Signing Authorities in India: Legal Guide & Compliance Checklist

At A’countable Partners, we often come across foreign entities as they navigate the complexities of entering and operating in the Indian business environment. One of the first and most essential steps for any foreign company is the appointment of a local signing authority. This individual acts as the company’s face in India, managing statutory, tax, regulatory, and financial obligations.

This article is a comprehensive guide to understanding how foreign companies can appoint signing authorities in India, the applicable laws, the process involved, and key compliance areas—all from the perspective of seasoned professionals at A’countable Partners.

Understanding the Role of a Signing Authority

A signing authority is a person designated to act on behalf of the foreign company for executing documents, filing regulatory forms, representing the company before Indian authorities, and receiving legal communications. Since foreign entities typically lack a local legal presence, the signing authority becomes a critical representative for ensuring operational continuity and legal accountability.

This individual must usually be a resident of India with the capability to obtain a Digital Signature Certificate (DSC), as most Indian statutory filings are digital.

Legal Framework Governing Signing Authority Appointments

India has a robust legal framework that mandates the appointment of authorized representatives for foreign companies. Here's how various statutes govern this requirement:

1. Companies Act, 2013

Section 380 of the Companies Act requires every foreign company establishing a place of business in India to submit details of an authorised representative to the Registrar of Companies (ROC). This representative is empowered to accept notices and respond to legal proceedings on behalf of the company.

At A’countable Partners, we help draft board resolutions and file Form FC-1 along with properly executed Power of Attorney documents and identity proofs.

2. Income Tax Act, 1961

Sections 160 and 163 define the role of a “Representative Assessee.” A foreign company with income sourced from India must appoint such a representative to file returns, manage assessments, and respond to notices.

Our team assists with PAN applications, drafting authorisation letters, and ensuring the appointed individual complies with income tax laws.

3. Goods and Services Tax (GST) Law

Foreign service providers, especially those offering OIDAR services, must register under GST and appoint an authorized signatory. This requirement also applies to non-resident taxable persons.

A’countable Partners routinely registers clients via Form REG-10 or REG-13 and ensures proper documentation, including address and ID proof of the Indian signatory, is in place.

4. FEMA, 1999 and RBI Compliances

Under FEMA, the Reserve Bank of India mandates local representatives for various reporting purposes, such as:

• FLA Return

• FDI/ODI compliance through the FIRMS portal

• Liaison, Branch, or Project Office registrations

We act as your Indian compliance partner to manage these filings by appointing a trusted local contact person and helping obtain necessary user registrations and DSCs.

5. Judicial and Regulatory Requirements

To execute contracts or deeds under Indian law, a foreign company must issue a Power of Attorney (PoA) that’s notarised in its country of origin, apostilled or consularised, and then adjudicated in India.

We guide our clients through this intricate process and offer attorney services where suitable, ensuring compliance with the Indian Stamp Act and local state regulations.

The Appointment Process: How We Facilitate It

At A’countable Partners, we follow a well-structured approach:

Board Resolution Drafting: We prepare detailed board resolutions covering scope of authority, tenure, and legal rights.

Power of Attorney (PoA): Our legal team drafts PoAs tailored to your business needs—specific or general—depending on the level of delegation required.

DSC Procurement: We assist your appointed representative in obtaining a Digital Signature Certificate, essential for ROC, GST, and RBI filings.

Who Can Be a Signing Authority?

The law doesn’t restrict who can be appointed, but in practice, these categories are commonly chosen:

• Indian employees or operational heads

• Directors of Indian subsidiaries

• External compliance consultants, like A’countable Partners

We at A’countable Partners assist by acting as authorized representatives for our international clients, combining legal clarity with operational convenience.

Risks, Controls and Practical Advice

Being a signing authority involves legal accountability. Incorrect filings, non-compliance, or miscommunication may expose the signatory to penalties. To mitigate this risk:

• Appoint individuals with a compliance background

• Clearly document roles and limitations in the PoA

• Create internal processes for review and approval

• Include indemnity clauses to protect the signatory

At A’countable Partners, we help design control frameworks so that the foreign company retains ultimate decision-making while meeting local requirements.

Conclusion

The appointment of a signing authority in India is not just procedural—it’s a strategic decision. It influences how efficiently and lawfully a foreign company can operate in the Indian landscape. From company law to tax filings and regulatory interactions, having the right signatory—properly authorized and supported—lays the foundation for long-term compliance.

At A’countable Partners, we specialize in offering end-to-end solutions for foreign companies entering or operating in India. Our deep understanding of compliance nuances, coupled with a commitment to precision and clarity, ensures that your business remains both agile and fully compliant.

Looking for reliable representation in India? Let A’countable Partners serve as your trusted compliance and advisory partner.