Property buy by foreigner
JEGADEESAN
(Querist) 21 March 2014
This query is : Resolved
Dear Sir,
I wish to clarify a doubt regarding purchase of property by a foreigner.
Is there any legal restriction in India to buy a property by a foreigner directly in his name for his personal use?
Any other alternate way to buy a property by a foreigner?
ajay sethi
(Expert) 21 March 2014
a foreign national who is a ‘person resident in India’ within the meaning of Section 2(v) of FEMA, 1999 can purchase immovable property in India, but the person concerned would have to obtain the approvals and fulfil the requirements, if any, prescribed by other authorities, such as, the State Government concerned, etc. The onus to prove his/her residential status is on the individual as per the extant FEMA provisions, if required by any authority. However, a foreign national resident in India who is a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan would require prior approval of the Reserve Bank.
R.V.RAO
(Expert) 21 March 2014
BY NRI
If you are an NRI or Person of Indian origin you can invest in land (other than agricultural, plantation or farm house). Repatriation of sale proceeds is permissible up to the amount of foreign exchange used for acquisition. Banks generally do not lend for purchase of land; however, loan based on assets/earning potential may be possible. This should be ascertained from the Bank concerned. Sale of land within 3 years of acquisition will render it a short-term capital gain taxable at normal slab rates. If held for more than 3 years, indexation benefit is admissible on cost of acquisition and rate of tax would be 20% + applicable surcharge and cess.
SOURCE:NRI TAX ISSUES http://www.thehindubusinessline.in/bline/blnri/exp-rbi.htmSOURCE:
BY FOREIGN NATIONAL
a person resident outside India(foreign national) can hold, own, transfer or invest in Indian currency, security or any immovable property situated in India if such currency, security or property was acquired, held or owned by such person when he was a resident in India or inherited from a person who was a resident in India.
3. The regulations under Notification No. FEMA 21/2000-RB dated May 3, 2000, as amended from time to time, permit a NRI or a PIO to acquire immovable property in India, other than agricultural land or, plantation property or farm house.
Further, foreign companies who have been permitted to open a Branch or Project Office in India are also allowed to acquire any immovable property in India, which is necessary for or incidental to carrying on such activity. Such dispensation is however not available to entities which are permitted to open liaison offices in India.
4. The restrictions on acquiring immovable property in India by a person resident outside India (foreign national) would not apply where the immovable property is proposed to be acquired by way of a lease for a period not exceeding 5 years or where a person is deemed to be resident in India.
In order to be deemed to be a person resident in India, from FEMA angle, the person would need to comply with the provisions of Section 2(v) of FEMA 1999.
Note: Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan cannot acquire or transfer immovable property in India, (other than on lease not exceeding five years) without the prior permission of the Reserve Bank.
source:http://www.rbi.org.in/scripts/FAQView.aspx?Id=33.
malipeddi jaggarao
(Expert) 22 March 2014
To summarize, a foreign national can not purchase immovable property in India staying at abroad. First, though he is foreigner, he should become a resident in India as per the provisions of FEMA.
"person resident in India" means-
(i) a person residing in India for more than one hundred and eighty-two days during the course of the preceding financial year.
It is not that any foreign national can purchase the immovable property in INdia.
Rajendra K Goyal
(Expert) 22 March 2014
Well advised by the experts, agree to it.
T. Kalaiselvan, Advocate
(Expert) 24 March 2014
