Samiah International Builders Pvt Ltd

Faq's

'We Are Concern About You'

Q. Do Non-resident Indian nationals require permission of Reserve Bank to acquire residential/commercial property in India?

Ans. No permission is required by Non-resident Indian national to acquire immovable property in India.

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

Ans. Yes, foreign national of Indian origin, resident abroad, have been permitted to purchase immovable property (residential or commercial) other than agricultural / plantation property or farm house, in India.

Q. What should be the method of payment for purchasing residential /commercial immovable property in India by foreign nationals of Indian origin under the new regulations?

Ans. The purchase consideration should be met out of the inward remittance in foreign exchange through normal banking channels or out of funds from any Non-resident account maintained with a bank in India.

Q. Are there any formalities be completed by foreign nationals of Indian origin for purchasing residential immovable property in India?

Ans. As such there are no formalities to be completed by foreign nationals of Indian origin for purchasing residential property in India except the mode of payment that is explained in earlier answer.

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

Ans. Yes.

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

Ans. Such rental income (net of applicable taxes) in the first instance, will have to be credited to the ordinary Non-resident rupee account of the owner of property. Thereafter in accordance with the provisions governing conduct of NRO accounts, current income may be repatriated outside India.

In case of NRIs not maintaining an NRO account in India, authorized dealers can remit rental income of current year on the basis of an appropriate certificate by a chartered accountant certifying that the amount proposed to be remitted is eligible for remittance and that applicable taxes have been paid or provided for. In case such an NRI is not having taxable income in India, he can remit rental income without CA's certificate, on a simple declaration (in duplicate) to the effect that he/she is not a tax payer in India.

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

Ans. Yes, such property can be sold a person resident in India, without the permission of Reserve Bank. Transfers to other persons who are not resident in India may be made with the prior permission of Reserve Bank.

Q. Can sale proceeds of such property if and when sold be remitted out of India?

Ans. Yes, if certain conditions are fulfilled. (i) The property was acquired by the seller in accordance with the provisions of foreign exchange law in force at the time of acquisition or the provisions of FEM (Acquisition and transfer of Immovable Property in India) Regulations, 2000. (ii) Repatriation is permitted to the extent of consideration amount in foreign exchange received through normal banking channels or out of funds held in FCNR a/c, or foreign currency equivalent, as on date of payment, where payment is made out of NRE a/c, for acquisition of the immovable property sold. (iii) In case of sale of residential property, repatriation is allowed for maximum of two such properties.

Q. What is the procedure for seeking such repatriation?

Ans. No procedural formalities are required. The authorized dealer shall simply ensure that the stipulated conditions are fulfilled. If the conditions are not fulfilled, then Reserve Bank's permission is to be obtained.

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

Ans. Reserve Bank has granted general permission to authorized dealers and financial institutions providing housing finance which are approved by National Housing Bank to grant housing loans to Non-resident Indian national for acquisition of a house/flat for self occupation subject to certain conditions. Repayment of the loan should be made by inward remittance through banking channels or out of funds held in the investors' NRE/FCNR/NRO/NRNR/NRSR accounts. Rental income derived from renting out such acquired property by utilizing loan amount can also be used for repayment.