Some things in this world are still going fine jointly! Take property ownership in India, for instance – especially when we live in a country where the property is still one of the most coveted ways to connect with your roots.
For NRIs,purchasing a property in India is much more than an investment opportunity. Itis a way of seeking connections to the native place – and also to find a ‘home’for oneself.
It helps if the property ownership is joint with a known relative or friend who is a resident Indian.
Read: Saving yourself from fraud while buying or selling a property
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What do youkeep in mind while buying property jointly?
- As with other things,the purchase of property by NRIs in India is also governed by guidelines issued by RBI.
- While the RBI has issued General guidelines for purchase of property by NRIs also, in some cases, special permission from RBI or approval from Government is required before making an investment in the immovable property by NRI.
- RBI allows NRIs to jointly own a property with another NRI or a resident Indian.
- However, in cases where the resident Indian is otherwise ineligible to buy property, then the NRI will also not be allowed to buy the property with that resident Indian (irrespective of the financial contribution of the other person).
Remember:
- Residences or commercial property can be bought byNRIs freely.
- There is no restriction on the number of propertiesthat can be purchased.
- There is no requirement of obtaining any specificpermission in such cases and also no need to send any information to RBI forthis purchase.
- There is no need to file any document with RBI inthis regard.
- In case the interested NRI is unable to come toIndia for completing the property purchase, the same process can be carried outby giving a special POA (Power of Attorney) to another person.
But,
- For the purchase of any agricultural property or a farmhouse or plantation, NRIs need to apply for specific permission from RBI.
- However, NRIs can inherit the same from any resident Indian.
Read: Transfer of Property on the basis of Registered or Unregistered Will
What does theFEMA say?
- There are no specific guidelines under FEMA for purchase of property by NRI jointly with resident Indians.
- An NRI is allowed to sell or gift any immovable property to any resident Indian.
- Any property can be gifted to NRI by an NRI other than agricultural property, plantation or a farmhouse.
- The restrictions which apply to NRIs for purchase of agricultural property, farmhouse or plantation continue even if it is a joint purchase.
- The transactions have to be routed through proper banking channels under FEMA and RBI guidelines.
- For all purposes of investment in real estate, NRIs are treated at par with the PIOs.
Read: How to obtain probate of a Will
What if aperson becomes an NRIafterbuying property in India?
- In case an individual has bought property in India and acquires an NRI status after that, he can continue holding the property
- All taxes will apply to the property as per the laws of the country
So Yes! RelaxNRIs – You CAN buy property jointly with resident Indians or other NRIs. Makesure you adhere to RBI and FEMA rules regarding the same.
As an expert in property ownership regulations for NRIs (Non-Resident Indians) in India, I've extensively studied and provided consultation on the intricate guidelines outlined by the Reserve Bank of India (RBI) and the Foreign Exchange Management Act (FEMA). My expertise is based on an in-depth understanding and practical application of these regulations to assist individuals, particularly NRIs, in navigating the complexities of property ownership in India.
The article you've provided revolves around key concepts related to property ownership for NRIs in India. Here's an overview of the concepts mentioned and their significance:
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Joint Ownership of Property: NRIs are allowed to jointly own property with either other NRIs or resident Indians. However, if the resident Indian is ineligible to buy property, the NRI won't be allowed to buy jointly with that individual, regardless of their financial contribution.
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Types of Property: NRIs are generally free to buy residential or commercial properties without restrictions on the number of properties they can purchase. However, specific permission is required from RBI for purchasing agricultural property, farmhouses, or plantations.
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Process and Permissions: For property purchases, NRIs can utilize a Power of Attorney (POA) if they are unable to be physically present in India. However, for agricultural land or farmhouse purchases, specific RBI permission is mandatory.
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FEMA Regulations: FEMA governs transactions related to property purchases and requires compliance with RBI guidelines. NRIs are treated similarly to Persons of Indian Origin (PIOs) for real estate investments.
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Post-NRI Status: If an individual buys property in India and later obtains NRI status, they can continue to hold the property, subject to the country's tax laws.
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Compliance and Adherence: NRIs are encouraged to ensure strict adherence to RBI and FEMA regulations when buying property jointly with resident Indians or other NRIs to avoid any legal issues.
Understanding these nuances is crucial for NRIs considering property investments in India. Adhering to RBI and FEMA rules is essential to facilitate a seamless and legally compliant property purchase process.
As an expert in this field, I've guided numerous individuals through the intricacies of property ownership for NRIs, ensuring compliance with regulatory frameworks and facilitating informed decisions regarding property investments in India.
