We are Wealth Clinic Team
For NRIs and OCIs, the acquisition or purchase of the farmhouse, plantation property or agricultural land by gifts is not allowed.
Non-resident Indians (NRIs) and Indian citizens outside India have to follow many different rules and laws when buying and selling property (OCI).
People who live outside of India, like NRIs and OCIs, can buy and sell real estate in India. Still, they have to follow the Foreign Exchange Management Act, 1999 (FEMA) and the Reserve Bank of India (RBI) rules. FEMA says that an NRI is a person who lives outside of India and is a citizen of India. An OCI is a person who lives outside of India and is registered as an overseas citizen of India Cardholder under Section 7(A) of the Citizenship Act, 1955.
As long as you are an NRI or an OCI, you can buy any number of residential or commercial properties in India under the rules set by the RBI. Besides buying a home or business, an NRI or OCI can also get a gift from any of his NRI, OCI, or resident relatives.
NRIs and OCIs can’t buy or get agricultural land, a farmhouse, or plantation property through gifts. However, an NRI or OCI can inherit any real estate in India from someone who lives there.
As long as the property was bought following the law when it was purchased, an NRI or OCI can inherit it from someone living outside of India.
NRIs and OCIs who want to buy real estate in India can pay for it with money that came into India through normal banking channels from a place outside India, or that is in an NRE, NRO, or FCNR account. If you want to pay, you can’t do it with a traveller’s check or money from another country.
In addition, a non-resident spouse of an NRI or an OCI can also buy real estate in India with their NRI or OCI spouse if their marriage is registered and has been going on for at least two years. The non-resident spouse should not be barred from buying real estate with their NRI or OCI spouse.
Neither NRIs nor OCIs has to pay any taxes on the sale of their real estate. However, there are some rules about how the money from the sale can be sent back to the United States.
People who are NRIs or OCIs can sell property that they bought while living in India or that they inherited. They can bring back up to $1 million per year, subject to paying taxes and meeting the requirements of an authorised dealer bank.
Suppose the NRI or OCI bought the properties through inward remittances or funds held in an FCNR(B) or NRE account. In that case, they can repatriate the money from the sale, but only up to two residential properties.
When an NRI or OCI gets a piece of property as a gift, the gift deed is legally valid. It can be used to change the title in revenue records, which means that the property’s name can be changed. Property bought through a will may need to be probated in the state where the property is to get a good title. The Will, or if probate is required, the Will that has been proven can be used for mutation and other things.
It can be challenging for NRIs or OCIs to keep track of their own and own in India. They can give someone in India the power to act on their behalf through a special power of attorney (POA). If you need to sign sale documents or do other things that need to be done, a special POA is usually made for that purpose. It can be revoked at any time.
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