Dr.
Justice A. R. Lakshmanan
An NRI can transfer any immovable property other than
agricultural land/plantation
property / farm house by way of sale to a person resident in
India. He can not sell agricultural land, farm house or / plantation property to any person, whereas he
can sell the other immovable property to a person, who is resident in India.
Thus, a person who is not a resident of India can not
purchase from a such a person any immovable property. Under the general
permission available, NRI / PIO may transfer by way of sale of his agricultural
land / plantation property / farmhouse in India to a person resident in India,
who is a citizen of India.
However, an NRI or PIO can 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.
An NRI or PIO can sell or gift even the agricultural land /
farm house / plantation property
provided the purchaser or / donee is Indian citizen and who
is resident in India. A person, who
is resident outside India or / a person, who is not a citizen of India can
not be a purchaser or /
donee from such a person. Thus, he / she has to be a citizen
of India and he / she is to be resident of India.
In short the purchaser or donee of agricultural land, etc.
from such a person has to be Indian citizen, who is resident of lndia.
An NRI or / PIO can
transfer residential or / commercial
property in India by way of gift to a person
resident in India or / to an NRI or / to a PIO but resident
outside India. Thus, if a person is a citizen of lndia or / of Indian origin or resident in India, then
he can be a donee of a gift of immovable property from, such a person.
An NRI can transfer by way of sale residential or commercial
property in India to a person
resident in India or to an NRI or / a PIO, whereas a PIO can transfer by way of
sale residential or / commercial property in India only to a person resident in
India or / NRI. A PIO would need to seek
RBI prior approval for transferring by way of sale residential or commercial
property in India to a PIO.
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. NRI Gaurav Sagar shares his experience, “For an NRI, who
wants to purchase a property India via bank loan, it is relatively easier to
get a loan, if the person is in service than business.
The disbursal of loan is always in rupees. If one sells a
property, the proceeds are also in rupees. However, one has to pay capital
gains tax on the profit recorded in the account books. After having the
proceeds sent to one’s bank account in India, he or she can transfer the money
to the overseas
bank account via telegraphic transfer, draft etc.”
NRI or PIO can mortgage residential or commercial property
to an authorised
dealer or / housing finance institution in India without the
approval of RBI, or to a party
abroad with prior approval of RBI. NRI or / PIO can rent out
the residential or / commercial
property purchased out of foreign exchange or / rupee funds,
without the approval of
RBI.
Src: Our Building and
Construction
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