NRI - Rules and Regulations
More importantly there are a number of Indians who are working presently abroad and hence are “Non-resident Indians” (NRIs) who would like to return to India. Many of them wish to own a house or flat for either their future use or as an investment. Some of them may even be holding a foreign passport. A few of them may be interested in buying farm houses or agricultural lands nearby or commercial properties. Having purchased one such property, some would like to sell it and then wish to know whether the sale proceeds can be taken out of India etc. There are a few NRIs who have settled abroad permanently but with inherited property in India. Naturally they would like to sell the property and take the money out of India. Parents of such NRIs who live face many such queries from their wards abroad. On their own also, many parents would like to advise their children abroad of how to invest in real estate and what the related rules are and so on. In an economy where there are no restrictions on movement of capital (popularly known as capital account convertible economies), the investor in real estate has only to think about the capital gains or loss by such investment and also the tax implications. In our country, where the capital account convertibility has not yet been implemented fully, the investors should also know the exchange control regulations relating to such investments like the number of properties that can be purchased or sold, the repatriability of the sale proceeds, the method in which the funds are remitted, the types of properties that can be acquired etc. This article attempts to explain these aspects in simple terms.
Power Of Attorney	Download Power Of Attorney Document
General Power of Attorney to e given by NRI for Purchasing Property, availing housing loan to another person dealing on his behalf in India
Purchasing
NRIs can purchase residential and/or commercial properties without any restriction. In other words, there is no ceiling on the number of such properties, he can buy, the size or value of such property etc. There is no ceiling on the value of such properties he can buy so long as it is only residential or commercial property i.e. it can be a villa, penthouse, shopping mall or all the shops on M G Road! There is no document or statement or any such details to be sent to RBI, government of India or to any bank before, during or after such purchase. This freedom is available to all non-residents who are either citizens of India (i.e. holding Indian passports) or who are Persons of Indian Origin (PIO). The permission is for buying residential or commercial property and not purchase of agricultural land or plantation property or farm house in India.
Agricultural Land
The NRI or PIO cannot purchase or get as gift farm house, agricultural land or plantation property. But it is possible that he may have been owning them before becoming an NRI or PIO. The law does not stipulate that such holdings are illegal or that they have to be sold immediately on becoming NRI or PIO. On the other hand, the law stipulates the rules relating to sale of such property if he so desires any time when he is a non-resident. The NRI or PIO can let out his property and the rent received is freely repatriable. In other words, even if he has a property owned by him out of local resources or owned before becoming an NIR or PIO, he can take the rent out of the country by converting it into US dollars at his bank. Of course, he cannot ask his tenant to pay the rent in dollars!
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