The South American had a short stint in Kolkata when Venezuela played against the Lionel Messi-led Argentina in a friendly in September 2011.
Overwhelmed by the "passion" for football in India, Farias said he always wanted to work in Kolkata.
"I experienced the passion that Indians possess for football first hand," Farias, who coached Venezuela to the semi-finals of the Copa America in 2011, said in a statement.
"I have a clear goal in mind: The development of NEUFC and also of Indian football," the 42-year-old said.
"He is a unifier and that is important when we have a squad that comes from different cultures and geographic regions. Most importantly, he is young, passionate, has a clear vision for the club," the Bollywood star said.