NRI buying property in India?
I've moved to Nottingham about a year back and could be staying out of India for the next couple of years. I needed to know if I were to buy a property in India what encumbrances I would encounter as an NRI?
There shall not be any additional encumbrances in your acquisition of property. For the purposes of this transaction your NRI status shall be governed by FEMA, 1999. The provisions that govern acquisition and transfer of immovable property by NRIs are sub-sections (3), (4), (5) of Section 6 of FEMA read with rules under Notification No. FEMA 21/ 2000-RB dated May 3, 2000 given by Reserve Bank of India. Some of the conditions that must be satisfied include:
1. The acquirer of immovable property shall either hold an Indian passport or his father/grandfather shall be a citizen of India (under provisions of Citizenship Act, 1955)
2. Should not hold citizenship of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, and Bhutan.
What kind of properties can be purchased?
A NRI can acquire any immovable property in India by way of purchase other than agricultural land, plantation property, farm house, etc.
Payment procedure for acquisition of immovable property
NRIs can make payment for acquisition of immovable property (mentioned above) out of:
a.Funds received in India through normal banking channels by way of inward remittance from any place outside India or by debit to his NRE / FCNR (B) / NRO account.
b.Such payments cannot be made either by traveller’s cheque or by foreign currency notes or by other mode except those specifically mentioned above.
Moreover, a NRI who has purchased residential / commercial property under general permission is not required to file any documents with the Reserve Bank.
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