B. For
investments in immovable properties.
Do non-resident Indian citizens require permission of the Reserve Bank to acquire
residential / commercial property in India?
No.
Do foreign citizens of Indian origin require permission of the Reserve Bank to
purchase immovable property in India for their residential use?
Yes. However, the Reserve Bank 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 of the Reserve Bank.
How should purchase considerations for the residential immovable property be paid
by foreign citizens of Indian origin under the general permission?
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 accounts
maintained with banks in India.
What are the formalities foreign citizens of Indian origin to purchase residential
immovable property in India under the general permission?
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 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.
Can such property be sold without the permission of the Reserve Bank?
Yes. The Reserve Bank has granted general permission for 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.
Can sale proceeds of such property if and when sold be remitted out of India?
In respect of residential properties purchased on or after 26th May 1993, Reserve Bank
considers applications for repatriation of sale proceeds up to the consideration amount
remitted in foreign exchange for the acquisition of the property for two such properties.
The balance amount of sale proceeds if any or sale proceeds in respect of properties
purchased prior to 26th May 1993, will have to be credited to the ordinary non-resident
rupee account of the owner of the property.
What conditions have to be met if repatriation of sale proceeds is desired?
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.
What is the procedure for seeking such repatriation?
Applications for necessary permission for remittance of sale proceeds should be made in
form IPI 8 to the Central Office of Reserve Bank at Mumbai within 90 days of the sale of
the property.
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