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Legal Advice

1. What documents and formalities are required while buying property?

Documents required while buying property are Identity Proof like Voters’ ID Card, Passport, Driving License, Ration Card and Pan Card. Be careful of the Sale Deed/Agreement and also check that the complete property chain is mentioned in the Deed.

1. Can non-resident Indian citizens 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.

2. Do foreign citizens of Indian origin require permission of the Reserve Bank to purchase immovable property in India for their residential use?

Yes. However, the RBI has granted general permission to foreign citizens of Indian origin, whether resident in India or abroad, to purchase immovable property in India for their bona fide residential purpose. They are, therefore, not required to obtain separate permission of The Reserve Bank.

3. Who is a foreign citizen of Indian Origin?

A foreign citizen is deemed to be of Indian Origin if : i) he held an Indian Passport at any time or ii) he or his father or paternal grand father was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955. However this does not apply to citizens of Pakistan, Bangladesh, Afghanistan, Bhutan, Sri Lanka or Nepal)

4. How should the purchase of residential immovable property be paid for by foreign citizens of India origin 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 accounts maintained with banks in India.

5. What formalities have to be completed by foreign citizens of Indian origin to purchase residential immovable property in India under the general permission?

They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration along with a certified copy of the documentary evidence for the transaction and bank certificate for the money paid.


6. Can such property be sold without the permission of Reserve Bank?

Yes. Reserve Bank has granted general permission for sale of such property. However, where the property is purchased by another foreign citizen of Indian origin, funds towards the purchase consideration should either be remitted to India or paid out of balances in NRE/FCNR accounts.


7. Can foreign citizens of Indian origin acquire or dispose residential property by way of gift?

 The Reserve Bank has granted general permission to foreign citizens of Indian origin to acquire or dispose of properties up to two houses by way of gift from or to a relative who may be an Indian citizen or a person of Indian origin, whether resident in India or not, provided gift tax has been paid.

8. Can immoveable property held in India be transferred by way of gift to in India?

General permission has been granted by Reserve Bank to non-resident persons (foreign citizen) of Indian Origin to transfer, by way of gift, immoveable property held by them in India to relatives and charitable trusts / organisations subject to the condition that the provisions of all other laws, as applicable are complied with.

9. Can NRIs obtain loans for acquisition of a house/flat for residential purpose from financial institutions providing housing finance?

The Reserve Bank has granted general permission to certain financial institutions providing housing finance e.g. HDFC and authorised dealers to grant housing loans to non-resident Indian nationals for acquisition of a house/flat for self-occupation, subject to certain conditions. Criteria regarding the purpose of the loan, margin money and the quantum of loan will be at par with those applicable to resident Indians. Repayment of the loan should be made within a period not exceeding 15 years, out of inward remittance through banking channels or out of funds held in the investors' NRE/FCNR/NRO accounts.

10. Can Indian companies grant loans to their NRI staff?

The Reserve Bank permits Indian firms to grant housing loans to their employees deputed abroad and holding Indian passport subject to certain conditions.

11. Are foreign nationals of Indian origin allowed to purchase immovable property in India?

 Yes, foreign nationals of Indian origin, whether resident in India or abroad, have been granted general permission to purchase immovable property in India

12. The NRIs are staying abroad can the property be purchased through the agent or through the Power of Attorney?

The NRI's who are staying abroad may enter into an agreement through their relatives and/or by executing the Power of Attorney in their favor as it is not possible for them to be present for completing the formalities of purchase (eg, 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.

13. Can such residential property be given on rent if not required for immediate residential use?


14. Can the rental income from such property be remitted outside India?

No. Such income cannot be remitted abroad and will have to be credited to the ordinary non-resident rupee account of the owner of the property.

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