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Who is an NRI?
'Non-resident Indian' is an individual who is a citizen of India or a person of Indian origin and who is not a resident of India.
Who is a PIO?
A Person of Indian Origin (PIO) means a foreign citizen (except a national of Pakistan, Afghanistan, Bangladesh, China, Iran, Bhutan, Sri Lanka and Nepal) who at any time held an Indian passport Or who or either of their parents/ grandparents/ great grandparents were born and permanently resident in India as defined in Government of India Act, 1935 and other territories that became part of India after that provided neither was at any time a citizen of any of the aforesaid countries ( as referred above); Or Who is a spouse of a citizen of India or a PIO
Who can purchase immovable property in India?
The following categories of persons can purchase residential and commercial immovable property in India:
- Non-Resident Indian (NRI)- that is a citizen of India resident outside India
- Person of Indian Origin (PIO)- that is an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan), who 1. at any time, held an Indian passport, or 2. who or either of whose father or grandfather was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955).
The general permission, however, covers only the purchase of residential and commercial property and not for the purchase of agricultural land/plantation property/farmhouse in India.
In case the NRI/PIO is unable to come to India, the documents pertaining to the purchase can be executed by any person, who is given a valid power of attorney
Documents required prior to purchase of Property
- Passport and/or PIO card: You will need to show your Indian passport. If you hold a foreign passport, you can buy property in India provided you have a PIO (Persons of Indian Origin) card.
- PAN Card: This is mandatory for property transactions.
- Power of attorney: To be executed and registered by the NRI/PIO, i.e. proposed Property buyer in favour of his Attorney to complete the necessary documents and tasks, in case he/ she is unable to come to India to complete the formalities.
Are there any restrictions and/or documents that need to be filed with the Reserve Bank of India (RBI) for the purchase of residential or commercial immovable property?
No. There are no restrictions and/ or documents to be filed with the Reserve Bank of India for the purchase of residential or commercial property by NRI / PIO under general permission. The RBI has given general permission to NRIs and PIO to buy any residential or commercial property in India. They need not seek any specific permission nor are they required to send any communication or intimation in this regard to the RBI.
Joint ownership
An NRI can purchase the property, either as a single owner or jointly, with any other NRI.
Acquisition and Transfer of Immovable Property in India
A person resident outside India who is a citizen of India (NRI) can acquire by way of purchase and transfer any residential and commercial immovable property in India other than agricultural land/plantation property/farmhouse.
How to fund the purchase of the Property?
The residential/ commercial property can be funded by:
- Funds received in India through normal banking channels by way of inward remittance from any place in India
- Funds held in any non-resident account are maintained in accordance with the provisions of the Foreign Exchange Management Act, 1999 and the regulations made by the Reserve Bank of India from time to time.
- Such payment cannot be made either by traveller’s cheque or by foreign currency notes or by another mode than those specially mentioned above.
- A person resident outside India who is a person of Indian Origin (PIO) can acquire any immovable property in India: - i. By way of purchase out of funds received by way of inward remittance through normal banking channels or by debit to his NRE/ FCNR(B)/ NRO account. ii. By way of gift from a person resident in India, an NRI, or a PIO.
- The RBI also allows home loans to RBI for the purchase of Property.
