Who is a NRI?
A NRI is a person resident outside India who is either a citizen of India or a person of Indian origin. A NRI is an Indian Citizen who has migrated to another Country. For all official purpose the Government of India considers Indian National away from India for more than 182 days, in a year.
Who is a PIO?
A person of Indian origin means an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan) who:
i) Held an Indian Passport at any time, or
ii) Who or whose father or paternal grand father was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955.
What are the types of Property can a NRI/PIO purchase in India?
There are no restrictions on the numbers of Residential/Commercial Properties (other than agricultural land/farm house/plantation) that can be purchased.
Does NRI/PIO require permission of The Reserve Bank to acquire residential/ commercial property in India?
No. All Indian citizens are entitled to buy property in India, irrespective of their residential status.
How should the purchase of residential immovable property be paid for by NRI/ PIO under the general permission?
The purchase consideration should be met either out of inward remittance in foreign exchange through normal banking channels, or out of funds from NRE/FCNR(B)/NRO accounts maintained with banks in India.
Is there are any Lock in period for such investment?
Currently there is no lock in period.
Can NRI/PIO sell their purchased property without the permission of Reserve Bank?
Reserve Bank of India has granted general permission for sale of such property to the following categories:-
“To a NRI
“To a PIO (If the seller is a PIO, then a prior approval is required from RBI)
“To a person Resident of India
Can the sale proceeds of such property (if and when sold) be remitted/repatriated out of India?
Yes the sale proceeds can be remitted/repatriated out of India
In the event property acquired out of foreign exchange source i.e. remittance through normal banking channels/ debit to NRE/ FCNR(B) accounts, the amounts to be repatriated should not exceed the amount paid for such property from such source. However, repatriation of sale proceeds purchased out of foreign exchange is restricted to not more that two residential properties, in a block of one year, with a facility of crediting the Capital gain to the NRO account.
Again in the event the property was acquired out of Rupee source, an amount not exceeding USD one million, per financial year, subject to tax compliance, out of balance held in NRO account, may be remitted/repatriated.
Can the properties (residential/commercial) be given on rent if not required for immediate use?
Yes. The Reserve Bank has granted general permission for letting out any immovable property in India.
Does any document require to be examined before buying a property?
Before you buy a property, you must get a title and document search properly conducted by hiring a competent advocate. You cannot examine the documents on your own, and thus, professional assistance needs to be taken.
What is meant by Carpet Area, Built-up Area and Super Built-up Area?
Carpet Area: It refers to the area of the apartment, excluding the area of the walls.
Built-up Area: It comprises the apartment area as well as the area of the walls.
Super Built-up Area: This term is used only when referring to multi-dwelling units. It includes the apartment area, the area of the walls and the area under common spaces like lobby, staircase, elevators, etc.
What documents need to be verified before making any purchase of a property?
The following documents must be
properly verified by an advocate before buying a property:
- Approved Layout Plan
- Approved Building Plan
- Title Ownership Documents
- Complete Search
What is meant by Stamp Duty?
Stamp Duty refers to charges in the form of taxes levied by the State Government.
Which instruments influence the payment of Stamp Duty on the market value of the property?
The following instruments have a great influence on the payment of Stamp Duty on the market value of the property:
- Agreement to Sell
- Conveyance Deed
- Exchange of Property
- Gift Deed
- Partition Deed
- Power of Attorney
- Lease Transfer
What is meant by a Freehold Property?
A Freehold Property refers to any plot or flat, where there is a sole proprietary ownership with no conditions under the land laws, and there is no less or lessee involved.
How can I verify if the documents submitted by the seller are authentic?
You might be required to hire an advocate to render his professional services for the proper examination of the authentication of the documents submitted by the seller.