|
Q. Do non-resident Indian nationals
require permission of Reserve Bank to acquire residential / commercial property in
India?
Ans. No permission is requi#0033ff
by non-resident Indian nationals to acquire immovable Property in India.
Q.
Are foreign nationals of Indian origin allowed to purchase immovable property in India?
Ans. Yes, foreign nationals
of Indian origin, whether resident in India or abroad, have been granted general permission
to purchase immovable property in India
Q. What should be the method
of payment for purchasing residential immovable property in India by foreign nationals
of Indian origin under the general permission?
Ans. The purchase consideration
should be met either out of inward remittances in foreign exchange through normal
banking channels or out of funds from NRE/FCNR accounts maintained with banks in India
Q. What way the Non-resident
Indian can finance the flat?
Ans. The purchase of the flats
can be financed from the fresh remittance through the normal banking channels or from
payment from original non-resident account or from Non-resident (External) Accounts.
When the flat is under construction, it may be possible to get instalment facilities
from the builder. Loan may also be available in India for purchase of flats, for example
from Housing Development Finance Corporation, ANZ Grindlays Bank, Citi Bank etc.
Non-resident Indians who are citizens of India (India Passport holders) are eligible
for housing finance for the acquisition of an immovable property or construction of
a new house, or a flat for their occupation or for that of their family in India.
But the HDFC also considers granting of loans to non-resident Indians even if they
are abroad, provided a family member of his or her in India is made a co-borrower
and a power of attorney is given to his representative in India.
Q. Non-resident Indians are
staying abroad can the property be purchased through the agent or through the Power
of Attorney?
Ans. The non-resident Indians who are staying abroad may enter
into an agreement through their relatives and/or by executing the Power of Attorney
in their favour as it is not possible for them to be present for completing the formalities
of purchase (negotiating with the builder or Developer, drafting and signing of agreements,
taking possession, etc.). These formalities can be completed through some known person
who can be given the Power of Attorney for this purpose. Power of Attorney should
be executed on the stamp paper before the proper authorities in foreign countries.
Power of Attorney cannot be drafted on the stamp paper bought in India.
Q.
Are there any formalities to be completed by foreign nationals of Indian origin for
purchasing residential immovable property in India?
Ans. They are requi#0033ff to file a
declaration in form IPI 7 with the Central Office of Reserve Bank at Bombay within
a period of 90 days from the date of purchase of immovable property.
Q. Can such residential
property be given on rent if not requi#0033ff for immediate residential use?
Ans. Yes.
Q. Can the rental
income from such property be remitted outside India?
Ans. No. Such income cannot be remitted abroad
and will have to be c#0033ffited to the ordinary non-resident rupee account of the
owner of the property.
Question
Answers Regarding Exchange Control Regulations in Respect of NRI investment in movable
property
Q. Do non-resident
Indians i.e. Indian citizens resident abroad require permission of Reserve Bank to
acquire any immovable property in India?
Ans. No specific permission is requi#0033ff
by non-resident Indian nationals to acquire immovable Property in India other than
agricultural / plantation/ farmhouse.
Q. Do non-resident
Indians require permission to transfer any immovable property in India to a person
resident in India ?
Ans. No specific
permission is requi#0033ff by Non-resident Indians to transfer any immovable property
in India to a person resident in India.
Q. Do non-resident
Indians require permission to transfer any immovable property to a person of Indian
origin resident outside India/Non-resident Indian ?
Ans. No specific permission is requi#0033ff
for said transfer of any immovable property, other than agricultural, or plantation
property or farm house.
Q. What is the
position in respect of a person of Indian origin resident outside India (PIO) for
acquisition/transfer of immovable property in India?
(i) A PIO does not require any specific permission
to acquire any immovable property other than agricultural land / farm house / plantation
property in India by purchase, from out of funds:
 received
in India by way of inward remittance through banking channel from any place outside
India; or
held
in any non-resident account maintained in accordance with the provisions of the Foreign
Exchange Management Act and the regulations made by the Reserve Bank under the Act.
(ii)A PIO does not require any specific permission
to acquire any immovable property in India other than agricultural land/farm house/plantation
property by way of gift from a person resident in India or from a person resident
outside India who is a citizen of India or from a person of Indian origin resident
outside India.
(iii)A PIO does not require any specific permission
to acquire any immovable property in India by way of inheritance from a person resident
outside India who had acqui#0033ff such property in accordance with the provisions
of the foreign exchange law in force at the time of acquisition by him or the provisions
of the Regulations of FEMA or from a person resident in India.
(iv) A person of Indian origin resident outside India
does not require any permission to transfer any immovable property in India other
than agricultural land/farmhouse/plantation property, by way of sale to a person resident
in India.
(v) A PIO does not require any specific permission
to transfer agricultural land/farm house/plantation property in India, by way of gift
or sale to a person resident in India who is a citizen of India.
(vi) PIO does not require any specific permission to
transfer residential or commercial property in India by way of gift to a person resident
in India or to a person resident outside India who is a citizen of India or to a PIO.
Q.
How should the purchase consideration for acquiring immovable property in India, be
met?
Ans. The purchase consideration
should be met either out of inward remittances in foreign exchange through normal
banking channels or out of funds from Non-resident accounts maintained with banks
in India
Q. What way the Non-resident Indians can finance
the flat?
Ans. The purchase of the flats can
be financed from the fresh remittance through the normal banking channels or from
payment from non-resident accounts. When the flat is under construction, it may be
possible to get instalment facilities from the builder. Loan may also be available
in India for purchase of flats, for example from Housing Development Finance Corporation,
ANZ Grindlays Bank, Citi Bank etc.
Q. Can Non-resident Indians purchase property
in India through an agent or through the Power of Attorney?
Ans. The non-resident Indians who
are staying abroad may give authority to their relatives/agents by executing Power
of Attorney in their favour as it is not possible for them to be present for completing
the formalities of purchase (negotiating with the builder or developer, drafting and
signing of agreements, taking possession, etc.). Power of Attorney should be executed
on the stamp paper before the proper authorities in foreign countries. Power of Attorney
cannot be prepa#0033ff on the stamp paper bought in India.
Q.What
are the provisions for remittance of sale of proceeds of any immovable property by
Non-resident Indians/Person of Indian origin, resident outside India ?
Ans. Repatriation
outside India, including c#0033ffit to RFC, NRE or FCNR account, of sale proceeds
of any immovable property situated in India, requires prior permission of the Reserve
Bank except in the following circumstances:
In the event of sale of immovable property other than agricultural land / farm house/plantation
property in India by a person resident outside India, who is a citizen of India, or
a person of Indian origin, the authorized dealer may allow repatriation of the sale
proceeds outside India, provided all the following conditions are satisfied
the
immovable property was acqui#0033ff by the seller in accordance with the provisions
of the foreign exchange law in force at the time of acquisition by him or the provisions
of Regulations under FEMA
the
amount to be repatriated does not exceed
(a) the amount paid for acquisition of the immovable
property in foreign exchange received through normal banking channels or out of funds
held in Foreign Currency Non-Resident account or
(b) the foreign currency equivalent, as on the date
of payment, of the amount paid where such payment was made from the funds held in
Non-Resident External account for acquisition of the property.
(c) In the case of residential property, the repatriation
of sale proceeds is restricted to not more than two such properties.
Reserve Bank has removed the existing lock-in-period for repatriation of the sale
proceeds of immovable property purchased in India by NRIs/PIOs. Accordingly, it will
be in order for authorized dealers to allow remittace of sale proceeds of immovable
property in India acqui#0033ff by NRIs/PIOs, irrespective of the period for which
the property was held. The sale proceeds allowed to be repatriated should, however,
not exceed the foreign exchange brought in to acquire the property.
Q.
What is the position regarding Refund of purchase consideration on account of non-allotment
of flats/plots/cancellation of bookings/deals in respect of immovable property purchased
by NRIs / PIOs in India.
Ans. With a view to allow c#0033ffit to NRE/FCNR account of
refund of purchase consideration by seller on account of cancellation of bookings/deals
for purchase of residential, commercial property, Reserve Bank clarified that it will
be in order for authorised dealers to allow Non-resident Indians/ Persons of Indian
Orign to c#0033ffit refund of application/earnest money/ purchase consideration made
by the housing building agencies/seller on account of non-allotment of flat/plot/cancellation
of bookings/deals for purchase of residential commercial property, together with interest,
if any (net ofincome tax payable thereon),to NRE/FCNR account, provided, the original
payment was made out of NRE/FCNR account of the account-holder or remittance from
outside India through normal banking channels and the authorised dealer is satisfied
about the genuineness of the transaction.
Q. Can
NRI/PIO rent out their immovable property in India?
Ans. Yes. The NRIs/PIOs can freely
rent out their immovable property in India without seeking any permission from the
Reserve Bank. The rental income being a current account transaction is freely repatriable
outside India.
Q. Where
can one contact with RBI for clarifications/approvals etc. in respect of immovable
property in India?
Ans. The Chief General
Manager, Reserve Bank of India, Central Office, Exchange control Department, Foreign
Investment Division (III), Mumbai - 400 001.
|