TaxTMI 
TaxTMI 
Master Circular on Acquisition and Transfer of Immovable Property in India by NRIs/PIOs/Foreign Nationals of Non- Indian Origin.
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....ubject. Yours faithfully, (Meena Hemchandra) Chief General Manager-in-Charge INDEX 1 Introduction 2 Acquisition and Transfer of Immovable Property in India A Non- Resident Indian (NRI) B Person of Indian Origin (PIO) 3 Acquisition of immovable Property by Foreign Embassies/ Diplomats/ Consulate Generals 4 Acquisition of immovable property by person resident outside India for carrying on a permitted activity 5 Repatriation of sale proceeds of immovable property 6 Refund of purchase consideration 7 Prior permission to the citizens of certain countries for acquisition or transfer of immovable property in India 8 Purchase of Immovable Property in India by a Foreign National of Non- Indian Origin resident outside India Annex-1 Press Release of Government of India Annex-2 Form IPI APPENDIX List of notifications / A.P.(DIR Series) 1. Introduction The Foreign Exchange Management Act, 1999 (FEMA) empowers the Reserve Bank to frame regulations to prohibit, restrict or regulate the acquisition or transfer of immova....
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....esident in India or a person resident outside India who had acquired such property in accordance with the provisions of the foreign exchange law in force or FEMA regulations, at the time of acquisition of the property. (iii) Transfer of immovable property A PIO can transfer any immovable property in India (other than agricultural land / farm house / plantation property) by way of sale to a person resident in India. He may transfer agricultural land / farm house / plantation property in India, by way of gift or sale to a person resident in India, who is a citizen of India. He may also transfer residential or commercial property in India by way of gift to a person resident in India or to a person resident outside India, who is a citizen of India or to a Person of Indian Origin resident outside India. iv) Payment for Acquisition of Immovable Property in India A PIO can make payment for acquisition of immovable property in India (other than agricultural land / farm house / plantation property): • By way of purchase out of funds received by inward remittance through normal banking channels or by debit ....
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....e proceeds of immovable property (A) Immovable property acquired by way of purchase (a) A person referred to in sub-section (5) of Section 6 of the Foreign Exchange Management Act^3, or his successor shall not, except with the prior permission of the Reserve Bank, repatriate outside India the sale proceeds of any immovable property referred to in that sub-section. (b) In the event of sale of immovable property other than agricultural land / farm house / plantation property in India by a person resident outside India who is a citizen of India or a person of Indian origin, the Authorised Dealer may allow repatriation of the sale proceeds outside India, provided the following conditions are satisfied, namely: (i) the immovable property was acquired by the seller in accordance with the provisions of the foreign exchange law in force at the time of acquisition by him or the provisions of these Regulations; (ii) the amount to be repatriated does not exceed: • the amount paid for acquisition of the immovable property in foreign exchange ....
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....er or remittance from outside India through normal banking channels and the Authorised Dealer is satisfied about the bonafides of the transaction. 7. Prior permission to the citizens of certain countries for acquisition or transfer of immovable property in India A citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan, whether resident in India or outside India, cannot acquire or transfer immovable property in India, without the prior permission of the Reserve Bank. This restriction is not applicable where the immovable property is taken on lease for a period not exceeding five years. 8. Purchase of Immovable Property in India by a Foreign National of Non- Indian Origin resident outside India • i. Foreign nationals of non-Indian origin resident outside India are not permitted to acquire any immovable property in India unless such property is acquired by way of inheritance from a person who was resident in India. However, they can acqu....
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....tablished a Branch Office or other place of business in India under the provisions of Foreign Exchange Management (Establishment in India of Branch or Office or Other Place of Business) Regulations, 2000 (FEMA 22/2000-RB dated the 3rd May, 2000) can acquire immovable property in India which is necessary for or incidental to carrying on such activity, subject to the conditions stipulated in Regulation 5 of Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2000 (Notification No. 21/2000-RBdated the 3rd May, 2000). Apart from above, a foreign national who is residing in India for more than 182 days during the course of the preceding financial year for taking up employment or carrying on business / vocation or for any other purpose indicating his intention to stay for an uncertain period can acquire immovable property in India as he would be a 'person resident in India' as per section 2(v) of FEMA, 1999. To be treated as a person resident in India under FEMA, a person has not only to satisfy the condition of the period of stay (being more than 182 days during the course of preceding financial year) but also his purpose of stay as well....
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....operty 5 (a) How the immovable property was acquired i.e. whether by way of purchase or lease (a) (b) Name, citizenship and address of the seller/lessor (b) (c) Amount of purchase price and sources of funds (c) I/ We hereby declare that- (a) the particulars given above are true and correct to the best of my/our knowledge and belief; (b) no portion of the said property has been leased /rented to, or is otherwise being allowed to be used by, any other party. Encls: &nb....