Who Is Non- Resident Indian (NRI) and Person of Indian Origin (PIO)?

An Indian Citizen who stays abroad for employment/carrying on business or vacation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. (Persons posted in U. N. Organizations and officials deputed abroad by Central/state Government and Public Sector undertakings on temporary assignments are also treated as non-residents). Non-resident foreign citizen of Indian Origin are treated on par with non-residential Indian Citizen (NRIs) for the purpose of certain facilities.

A foreign citizen (other than a citizen of Pakistan, Bangladesh, Afghanistan, Bhutan, Sri Lanka or Nepal), is deemed to be of the Indian Origin if he held and Indian Passport at any time, or he or his father or parental grand-father was a citizen of India by virtue of the (Constitution of India or the Citizenship Act, 1955(57 of 1955).

Is permission required from RBI to acquire/purchase immovable property in India?

No. General Permission is available to purchase only a residential/commercial property in India to a person resident outside India who is a citizen of India (NRI) and who is a Person of Indian Origin (PIO).

What is the manner and formalities required towards the payments to be done under general permission guidelines?

The purchase consideration should be met either out of inward remittances in foreign exchange through normal banking channels or out of funds from NRE / FCNR accounts maintained with banks in India.They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration along with a certified copy of the document evidencing the transactions and bank certificate regarding the consideration paid.

Can such property be sold without permission of Reserve Bank?

Yes, Reserve Bank has granted general permission for sale of such property. However, whether the property is purchased by another foreign citizen of Indian Origin, funds towards the purchase consideration should either be remitted to India or paid out of balance in NRE / FCNR accounts.

Can sale proceeds of such property be remitted out of India?

With respect to residential properties purchased on or after 26th May 1993, Reserve Bank considers applications for repatriation of sale proceeds up to the consideration amount remitted in foreign exchange for the acquisition of the property for two such properties. The balance amount of sale proceeds if any or sale proceeds in respect of properties purchased prior to 26th May 1993 will have to be credited to the ordinary non-resident rupee account of the owner of the property.

What is the procedure for seeking repatriation and conditions required towards the sale proceeds?

Applications for necessary permission for remittance of sale proceeds should be made in form IPI 8 to the Central Office of Reserve Bank at Mumbai within 90 days of the sale of the property. Applications for repatriation of sale proceeds will be considered, provided the sale takes place after three years from the date of final purchase deed from the date of payment of final installment of consideration amount, whichever is later.

Can a foreign citizen of Indian Origin acquire or dispose of such property by way of gift to relatives/registered charitable trust/ organizations in India or abroad?

Yes. Reserve Bank has granted general permission to a foreign citizen of Indian Origin to acquire or dispose of properties up to two houses by way of gift from or to a relative who may be an Indian Citizen or a person of Indian origin whether resident in India or not, subject to compliance with applicable tax laws.

Can the properties be given on rent if not required for immediate use?

Yes. Reserve Bank has granted general permission for letting out any immovable property in India. The rental income or proceeds of any investment of such income are eligible for repatriation.

Who can purchase immovable property in India?

A.1 Under the general consent accessible, the accompanying classes can openly buy undaunted property in India:

  • Non-Resident Indian (NRI) - that is a inhabitant of India occupant outside India
  • People of Indian Origin (PIO) - that is an individual (not being a resident of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan), who
  • whenever, held Indian travel permit, or
  • or both of whose dad or granddad was a resident of India by ideals of the Constitution of India or the Citizenship Act, 1955 (57 of 1955).
  • The general consent, be that as it may, covers just buy of a private and business property.

Can NRIs sell the properties they hold in india without reserve bank's permission?


Can NRIs acquire or dispose residential property by way of gift?

Indeed, the Reserve Bank has allowed general consent to NRIs to get or discard NRI India Properties by a method for a gift from or to a relative who might be an Indian native or a man of Indian origin (PIO) regardless of whether inhabitant in India or not.

Can NRIs obtain loans for acquisition of a house/flat for residential purpose from financial institutions providing housing finance?

The Reserve Bank has conceded some broad consent to certain financial establishments giving housing finance e.g. HDFC, LIC Housing Finance Ltd., and so on, and approved merchants to allow housing loans to NRI nationals for procurement of an NRI house/apartment for self-occupation subject to specific conditions. Criteria in regards to the motivation behind the credit, margin money and the quantum of advance will be at standard with those materials to Indian residents. Reimbursement of the loan ought to be made inside a period not surpassing 15 years, out of internal settlement through keeping bank channels or out of assets held in the speculators' NRE/FCNR/NRO accounts.