This particular section has been created for the benefit of all our domestic and foreign (of Indian Origin) Investors, partners and clients to help them better understand the rules and regulations for investing in property in India, how to make the best purchase decisions and the easiest ways to profit from burgeoning real estate market in India.
Our investment decisions have always been based on a detailed financial and business analysis. Due diligence is not just valued but followed and risk management is ingrained into every business decision that we make. This helps ensure that the creative reinvention that becomes a part of our associations and partnerships is guided by conservative and fundamentally sound business philosophies.
Reserve Bank of India 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 from the Reserve Bank.
The purchase consideration should be met either out of inward remittances in foreign exchange, through normal banking channels, or out of funds from NTE/FCNR accounts maintained with banks in India.
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 the immovable property, or final payment of purchase consideration, along with a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.
Yes. The Reserve Bank has granted general permission for the 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.
Applications for repatriation of sale proceeds are considered provided the sale takes place after three years from the date of final purchase deed, or from the date of payment of final instalment of consideration amount, whichever is later.
Yes. 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
Yes. Under the general permission granted by Reserve Bank, properties other than agricultural land/farm house/plantation property can be acquired by foreign citizens of Indian origin, provided the purchase consideration is met either out of inward remittances in foreign exchange through normal banking channels or out of funds from the purchasers' NRE/FCNR accounts maintained with banks in India and a declaration is submitted to the Central Office of Reserve Bank in form IPI 7, within a period of 90 days from the date of purchase of the property/final payment of purchase consideration.
Yes. The Reserve Bank has granted general permission for letting out of any immovable property in India. The rental income or proceeds of any investment of such income has to be credited to NRO account.
The Reserve Bank has granted general permission to certain financial institutions providing housing finance, e.g. HDFC, LIC Housing Finance Ltd., etc., to grant housing loans to non-resident Indian nationals for acquisition of houses/flats for self-occupation, subject to certain conditions.
Regulations/Directions issued by Reserve Bank of India
Regulations regarding acquisition and transfer of immovable property in India by a person resident outside India has been notified vide RBI Notification No. FEMA 21/2000-RB, dated May 3, 2000, as amended vide Notification No. FEMA 64/2002-RB, dated June 29, 2002 and Notification No. FEMA 65/2002-RB, dated June 29, 2002 and relevant directions issued in the form of A.P. (DIR Series) Circulars. These are available on the RBI website:
The NRI/PIO who has purchased residential/commercial property under general permission is not required to file any documents with the Reserve Bank.
There is no restriction on the number of residential/commercial property that an NRI/PIO can purchase under the general permission available.
No. Under section 2 (ze) of the Foreign Exchange Management Act, 1999 "transfer" includes, among others, "purchase." Therefore, a foreign national of non-Indian origin, resident outside India, cannot acquire any immovable property in India by way of purchase.
Yes. A foreign national of non-Indian origin, including a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan, may acquire only residential accommodation on lease, not exceeding five years for which he/she does not require prior permission of Reserve Bank of India.
Acquisition of immovable property in India by way of gift by a person resident outside India
Yes. Under general permission available, an NRI/PIO may acquire residential/commercial property by way of gift from a person resident in India or an NRI or a PIO.
No. Under section 2 (ze) of the Foreign Exchange Management Act, 1999, "transfer" includes, among others, "gift." Therefore, a foreign national of non-Indian origin, resident outside India, cannot acquire residential/commercial property in India by way of gift.
Transfer of immovable property in India, by way of sale by a person resident outside India
An NRI can transfer, by way of sale, residential/commercial property in India to a person resident in India or to an NRI or a PIO.
PIO can transfer, by way of sale, residential/commercial property in India only to a person resident in India.
No. He would need to seek Reserve Bank's prior approval for transfer, by way of sale, residential/commercial property in India to an NRI or a PIO.
The Non-Resident Indians who are staying abroad may give authority to their relatives/ agents by executing Power of Attorney in their favour as it is not possible for them to be present for completing the formalities of purchase (negotiating with the builder or developer, drafting and signing of agreements, taking possession, etc.). Power of Attorney should be executed on the stamp paper before the proper authorities in foreign countries. Power of Attorney cannot be prepared on the stamp paper bought in India.
The Chief General Manager
Reserve Bank of India
Exchange control Department
Foreign Investment Division (III)
Mumbai - 400 001
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