Non-Resident Indian Nationals
NRIs do not require any permission for acquisition/holding/transfer/disposal of immovable property. However, they are not eligible to purchase agricultural land, farm houses and plantation property.
However, on acquiring foreign citizenship, permission has to be obtained for holding immovable property in India by applying to the Reserve Bank of India in form IPI -1.
Persons of Indian Origin
For the above purpose, the definition of a Person of Indian Origin is :
- he held an Indian Passport at any time or ;
- he or his father or paternal grand father was a citizen of India by virtue of citizenship Act 1955 (57 of 1955);
- Citizens of Pakistan, Bangladesh, Afghanistan, Bhutan,Nepal and Sri Lanka are not considered to be of Indian Origin.
- Acquisition of Immovable Property on Non-repatriation basis
General Permission is available to Persons of Indian Origin for purchase of immovable properties in India for bonafide residential purposes. This permission also covers immovable properties acquired by way of inheritance.
The sale proceeds can not be repatriated.
The purchase consideration has to be by way of remittance from abroad or from NRE/FCNR Account.
A declaration in form IPI 7 has to be filed with the Reserve Bank of India within 90 days of acquisition.
- Acquisition of Properties on Repatriation basis
From 26.5.1993, general permission has been granted to PIOs to acquire residential property for their bona-fide residential use as well as commercial properties (other than agricultural land/farm house/plantation property) on repatriation basis.
There is no restriction on the number of residential/commercial properties that can be purchased.
However, facilities of repatriation of sale proceeds is limited to two residential properties. There is no restriction in respect of commercial properties.
Purchase considerations has to be remitted from abroad or from NRE/FCNR account.
Declaration in form IPI7 has to be filed with RBI in 90 days of acquisition.
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Acquisition by way of gift/inheritance
General permission is available for acquisition of two houses only. The gift should have been received from a relative who may be an Indian Citizen or a Person of Indian Origin.
A declaration in form IPI 7 has to be filed within 90 days of acquisition.
Acquisition of property by Persons of Indian Origin out of Rupee Funds.
Prior permission of the Reserve Bank of India has to be obtained by making an application in form IPI 1.
- Disposal of Properties
The general permission mentioned above also covers disposal/transfer of properties other than agricultural land, farm houses, plantation property etc. held by Persons of Indian Origin with general permission of Reserve Bank of India.
Application for repatriation of the original amount invested has to be made to RBI in form IPI 8.
Gift to a relative who may be an Indian Citizen/PIO upto two houses is permissible.
Sale Proceeds equivalent to the original amount of purchase consideration remitted in foreign exchange for acquisition of property can be repatriated, with permission of RBI, provided the sale is made after a lock-in-period of 3 years from the date of acquisition.
The balance amount has to be credited to the applicant's NRO account.
For repatriation of sale proceeds, Non-resident Indian Nationals are also governed by the same rules.
- Letting out of property
Immovable properties acquired in India can be rented out without RBI permission. Rental income has to be credited to NRO account.
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