In this write up we endeavor to summarize the conditions for the purchase and sale of immovable property in India by a non resident Indians and overseas citizens of India. Ideally the NRI/OCIs are permitted to acquire the immovable property in India in the following manner:
1. Business Owner: means a person resident outside India who has established a branch office or project office or any other place of business in India accordance with FEMA provisions;
2. NRI: Indian citizen, resident outside India;
3. OCI: Overseas Citizen of India who is registered as an OCI Cardholder under the Citizenship Act, 1955;
4. Relative: Refers to the relative defined under section 2(77) of Companies Act, 2013;
5. Restricted Property: means the following immovable property (a) agricultural land or (b) plantation property or (c) farm house property;
6. Restricted Countries: Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan, Hong Kong or Macau or Democratic People’s Republic of Korea (DPRK)
Acquisition of immovable property in India
|PARTICULARS||CONDITIONS APPLICABLE ON ACQUISITION||CONDITION APPLICABLE ON SALE OF PROPERTY|
PURCHASE OF NON RESTRICTED IMMOVABLE PROPERTY
|Other than restricted property may be acquired by NRI/OCI by making payment of consideration from:
(i) funds received in India through banking channels by way of inward remittance from any place outside India or
(ii) funds held in any non-resident account permitted under FEMA.
*Please note that no payment can be made including the part payment or down payment by Pay pal, travelers cheque, foreign currency or any other mode
Whom to sell?
NRIs and OCIs are permitted to transfer:
a) Restricted or Non Restricted Property (both): To a person resident in India;
b) Non Restricted Property: to an NRI or OCI.
Repatriation of sale proceeds?
Following conditions are applicable on the repatriation of sale proceeds of immovable property other Restricted Property:
a) the immovable property should have been acquired by the NRI/OCI as per the foreign exchange law in force at the time of his acquisition;
b) the amount for acquisition of the immovable property should have been paid in foreign exchange received as per the applicable law;
c) in the case of residential property, the repatriation of sale proceeds is restricted to not more than two such properties.
RECEIPT OF GIFT OF NON RESTRICTED PROPERTY
|Other than restricted property may be acquired by NRI/OCI as Gift from a Relative (defined above) who is:
a) a person resident in India; or
INHERITANCE-RECEIPT OF BOTH RESTRICTED AND NON RESTRICTED PROPERTY
|NRI/OCI may acquire both restricted and non restricted immovable property from:
a) a person resident outside India who had acquired such property in accordance with the provisions of the foreign exchange law in force at the time of acquisition; or
b) from a person resident in India;
|JOINT ACQUISITION BY THE SPOUSE OF AN NRI OR AN OCI OF IMMOVABLE PROPERTY OTHER THAN RESTRICTED PROPERTY:-
|Joint acquisition can be made by purchase, subject to the following conditions:
a) Consideration: shall be paid from (i) funds received in India through banking channels; or (ii) funds held in any non-resident account maintained in accordance with the provisions of the Act;
b) Marriage: the marriage has been registered and subsisted for a continuous period of not less than two years immediately preceding the acquisition of such property;
c) Prohibition: The non-resident spouse is not otherwise prohibited from such acquisition.