Who is an NRI?
"Non Resident Indian" (NRI) means a person who is a resident of a foreign country but is a citizen of India.
Who is an NRI under the provisions of Foreign Exchange Management Act?
An Indian Citizen who stays abroad for employment or is carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an non- resident Indian is an NRI. Person who is not resident in India for a period over 182 days is a non -resident Indian. Persons posted in U.N. organizations and officials deputed abroad by Central/State governments and Public Sector undertakings on temporary assignments are also treated as non - residents.
Who is a Person of Indian Origin (PIO)?
Under the provisions of Foreign Exchange Management Act a person of Indian origin is an individual (other than a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan) who at any time held an Indian passport, or he or his father or his grandfather was a citizen of India by virtue of the Constitution of India or Citizenship Act, 1955 (57 of 1955).
Do NRI's and PIOs require permission from Reserve Bank to acquire residential / commercial property in India?
NRI's and PIOs do not require permission from RBI to acquire residential / commercial premises in India (other than agricultural land/farm house/plantation property).
Can NRIs and PIOs give residential / commercial premises on rent if not required for immediate use?
Yes. Reserve Bank has granted general permissions for letting out any immovable property in India. The rental income or proceeds of any such income are eligible for repatriation subject to payment of taxes and production of a certificate issued by a chartered accountant with the guidance of an Authorized Dealer such as a bank for completion of formalities.
Who is eligible to apply for OCI?
A foreign national, who was eligible to become a citizen of India on 26.01.1950 or was a citizen of India on or anytime after 26.01.1950 or belonged to a territory that became part of India after 15.08.1947 and his/her children and grandchildren, provided their country of citizenship allows dual citizenship in some form or the other under the local laws, is eligible for registration as an Overseas Citizen of India (OCI). Minor children of such a person are also eligible for OCI. However, if the applicant had ever been a citizen of Pakistan or Bangladesh, he/she will not be eligible for OCI.
What is meant by Repatriation?
Repatriation is the transfer of funds from India to accounts held overseas. Repatriation pertaining to Real Estate in India is in accordance with the provision of the Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2000 as defined in Sections 6 and 47 of FEMA, 1999 and Notification No. FEMA 21/2000-RB dated May 3, 2000.
How should NRIs and PIOs make payment of the consideration for residential/commercial property?
The purchase consideration should be met either out of inward remittances in foreign exchange through normal banking channels or out of funds from NRE/FCNR/NRO accounts maintained with banks in India.
What are the Channels of Repatriation?
• NRE (Non Resident External Account) account (Savings/Current/ Fixed Deposits): Is freely repatriable (principal and interest) and does not require prior permission from RBI. Many banks like HDFC, PNB, SBI, ICICI et al offer NRE facilities.
• FCNR (Foreign Currency Non Resident Account) (Deposits): FCNR Deposits are fully repatriable (principal and interest). And the entire deposit is exempt from tax. All major banks HDFC, ICICI, SBI offer this facility.
• NRO account Non- Resident Ordinary Account(Savings): NRO deposits are not repatriable (principal) except on current NRI income like rent, dividend, pension, etc. and remittances indicated under "Repatriation of NRO Funds" only after payment of taxes due in India. Interest is freely repatriable. The NRI may remit up to USD one million per calendar year.
• RFC account (Resident Foreign account): This account is available for returning Indians only, that is Indian who have permanently returned to India after holding NRI status. Funds can be repatriated on a need basis.
What is meant by valuation of property?
The valuation process evaluates the market value of the property. Demand and supply forces operating in the market, as well as other factors like type of property, quality of construction, its location, the local infrastructure available, maintenance, are all taken into consideration before the market value is decided.
Who is the appropriate authority for knowing the market value of the property?
The Sub-Registrar of the area, in whose jurisdiction the property is located, is the appropriate authority for knowing the market value of the property.
Can a Power of attorney be issued to someone else to register the document in case of being out of country?
Yes, the Power of Attorney Draft can be signed and attested by the Indian Consulate/ Indian Embassy/or local notary. Once the Power of Attorney is received in India, the same has to be submitted to the Collector of Stamps for adjudication. After the same is adjudicated the POA holder can submit the same at the time of registration of the document.