What is the list of documents that you should verify before booking a property? +

A. Confirm the approved plans from the appropriate authority are in place.
B. Check that all other permissions from various authorities are in place. E.g. Utility Companies, Environment clearance, Airport Authority, etc.
C. Confirm that the Land title is clear and there is no disputes/litigation (Title Certificate).
D. Confirm Builder has the Intimation of Disapproval (IOD) and commencement Certificate (CC) to start construction.
E. Have the agreement evaluated by an Advocate. Check possession date promised and provide for penalty if Builder does not deliver as agreed.
F. Check and negotiate the payment schedule.
G. Do not book in Pre-launch without executing and registering the agreement. In Maharashtra, it is mandatory for Builder to do both at inception stage itself.

What documents are necessary before making a sale deed? +

Same set of documents as above. The agreement must record the title flow, the various permissions taken and the terms agreed to by the parties. In Maharashtra, the Maharashtra Ownership Flats Act, 1963 prescribes disclosures to be made, documents to be attached and even a model agreement format which is mandatory in part.

List of documents to verify at the time of registering your property+

1. Approved plans
2. Title Certificate from Advocate of current date
3. Copy of IOD/Commencement Certificate
4. Stamp duty paid receipt
5. Demand Draft for payment of Registration fees.
6. Property Card showing CTS No. of plot
7. PAN cards of Sellers and Buyers
8. Khata Extract

Due diligence before buying a resale property+

1. Check for a duly stamped registry
2. Ensure no dues are accorded to the builder
3. Check for seller’s name in municipal records
4. Confirm seller’s membership in the society (if formed)
5. Ensure there are no pending bills, charges or taxes
6. Make sure that the property is mortgage free
7. Sanctioned Building Plan (to ensure no unauthorized construction)
8. Previous title documents (that chain of title is complete)

How to verify project approvals documents? +

Same documents as above would need to be verified for checking project approvals. Confirm approved plans, other approvals such as environmental clearances are important and NOC from utility companies. Title Search must be carried out at the Sub Registrar’s office to verify title and ascertain encumbrances, if any.

How to verify the authenticity of the various documents submitted by the seller? +

1. Approved plans can be verified from the corporation or other plan sanctioning authority’s office.
2. Ownership documents of land or development rights held by the builder can be confirmed from the Sub Registrar’s office where they are registered.
3. Society share certificate can be verified from the Society itself.

Which documents must be compulsorily registered? +

As a general rule the following documents pertaining to immovable property must be registered vide Section 17(1) of the Registration Act, 1908:
(a) Instruments of gift of immovable property;
(b) other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees, and upwards, to or in immovable property;
(c) non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest; and
(d) leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent;
(e) non-testamentary instruments transferring or assigning any decree or order of a court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property.

In Maharashtra State, w.e.f. 1-4-2013, the following additional documents are also required to be compulsorily registered:
(f) agreement relating to the Deposit of Title Deeds, where such deposit has been made by way of security for the repayment of a loan or an existing or future debts;
(g) Sale certificate issued by any competent officer or authority under any recovery Act;
(h) Irrevocable Power of Attorney relating to transfer of immovable property in any way, executed on or after the commencement of the Registration (Maharashtra Amendment) Act, 2010.”

What all documents should you have at the time of possession? +

1. All original chain of agreements form part of the title documents and must be obtained by the buyer.
2. Do remember to obtain the original registration receipts and the original stamp duty receipts.
3. A letter of possession duly witnessed by two witnesses confirming the physical handover of the premises.
4. In case of a Society, the original share certificate together with all transfer forms duly executed.
5. Proof of payment of all dues such as maintenance, electricity, phone, water, property taxes upto the date of handing over possession.
6. A limited power of attorney from the Seller(s) authorizing the buyer(s) to sign all documents and applications etc. pertaining to the said premises.
7. An NOC from the Society or other body confirming that they have no objection to the transfer.

What is a sale deed? +

A sale deed, also called a “conveyance”, is a document which transfers immovable property be it land or a house, flat, office or other structure to another person. In almost all cases, the sale deed must be registered compulsorily except in the case of resale of units in existing cooperative societies where the state law grants a specific exemption from registration. Regardless, all sale deeds are liable for stamp duty and the rates vary from state to state. Also the duty depends upon various factors, such as age of building, location and type of unit and so on.

What is a title deed? +

A title deed is a document that proves the right of a person to an immovable property. A person can acquire an immovable property by various means and a properly stamped and executed document evidencing the transaction is a title document. For example a sale deed, a release deed, a relinquishment deed, a gift deed, a family settlement deed, a partition deed, a will all are evidence of how a person has acquired an immovable property and may be called title deeds.

What is a conveyance deed? Why is it required? +

The word conveyance means the transfer of ownership or interest in real property from one person to another by a document, such as a deed, lease, or mortgage. In India, transfer of property or rights in immovable property is governed by the Transfer of Property Act, 1882. For the transfer of any immovable property or rights in immovable property, it is necessary to execute a conveyance deed.

What is deemed conveyance? Why is it required? +

Many Builders have failed to transfer the buildings to the society or condominium formed by them despite it being mandatory for them to do so. In Maharashtra, the Maharashtra Ownership Flats Act, 1963 permits a Society, Company or Association of members to apply unilaterally for a conveyance if the Builder fails to do so to the competent authority. The Sub Registrar will thereafter register the Conveyance after giving an opportunity to the builder to show cause as to why the conveyance should not be registered. The Conveyance grants title to the Society. Many a time, Societies have found the lack of a conveyance to be a serious impediment when they set out to redevelop or reconstruct the building(s).

What is a building completion certificate? +

A building completion certificate is the final document granted by the plan sanctioning authority and usually follows the occupancy certificate. This document certifies that all acts necessary in connection with the construction of a building are complete.

What is an occupancy certificate? +

An occupancy certificate is granted by the plan sanctioning authority once the building is complete and ready for Inhabitation. In some places, an official water connection is granted only after the OC has been obtained. This document is given after verification that the construction has been carried out in accordance with the approved plans. The builder is not entitled to give possession and the unit buyer is not allowed to occupy the unit till the OC has been obtained. Further, the property comes into existence on and from the date of granting of OC. Property taxes are also levied as a unit from the OC date.

What is a Khata? +

A Khata is a record of assessment of a property, giving details of the property such as location, area, usage etc. for the purpose of payment of property tax. It is issued by the Municipal Corporation or other authority entitled to levy property tax such as a Development authority or a Panchayat. The Khata shows who is the registered owner of the property in the records and if you have acquired a property by sale, gift, will, etc. , you should have your name substituted for that of the seller in the Khata. This is another document you must check whilst buying a property to verify the title of the seller.

Property Title
How to register your property? +

The original property document to be registered along with a copy is to be presented with the concerned Sub- Registrar by the Seller. Both Seller and the Purchaser are present before the concerned Sub- Registrar who admits the execution of the document.
The sub- registrar after making the due inquiry registers the documents and returns the original document to the concerned party.

Can you sell the flat without registration? +

No. You cannot sell a property without proper registered document(s). A registered document is the authenticity and guarantee of the ownership over the property. Neither should one sell a property without proper registered documents and neither should one purchase a property wherein the seller does not have registered document of his/her ownership in the Property.

What is Power of Attorney? +

Power of Attorney is the right/authorization given by a property- owner to someone through whom the owner transfers the power and rights to deal with the Property to his/her chosen power of attorney. A power of attorney can be either a co-owner of the property, a blood- relative of the owner or any other person not related to that property or the owner.
There are two types of power of attorney that can be granted namely ‘General Power of Attorney’ wherein a property owner gives ‘general’ rights to his/her chosen attorney. These include but are not limited to sell, lease, sub-lease etc. the Property as the Power of Attorney deems fit. The other type is ‘Special Power of Attorney’ wherein only a ‘special’ or ‘specific’ right is given by the owner to his/her chosen Power of Attorney.

Can a Power of Attorney be issued to someone else to register the document? +

Yes, by executing a ‘Special Power of Attorney’ for this purpose, the property owner can transfer his/her right to register a property document to someone else.

What is the difference between leasehold and freehold property? +

The basic difference between a leasehold property and the freehold property is the ‘ownership’ of the Property. In a leasehold property, technically the ownership remains with the concerned Authority or the government (as the case maybe). But this does not bar the individual owner (known as Lessee in this case) from selling or dealing with the leasehold property as he/she may deem fit. In a leasehold property, the Lessee has to basically execute a tripartite sub- lease deed executed between the Lessee, the Purchaser and the Lessor (which is the concerned Authority or the government).
Whereas in a freehold property, the owner of the Property is the final owner of the Property and can sell/lease/mortgage the Property as he/she may deem fit.

How to convert leasehold property into freehold property? +

Conversion from leasehold to freehold can be done only if the local laws allow it. For instance, property owned under Delhi Development Authority can be converted to freehold by executing a Conveyance Deed. However, conversion of leasehold to freehold is not an option for properties falling in New Okhla Industrial Development Authority (NOIDA).

The process of converting leasehold to freehold, the owner (Lessee) applies to the concerned Authority or Government requesting the conversion of the Property. Thereafter, a Conveyance Deed is executed between the concerned Authority or Government and the Owner of the Property.

What are the taxes that need to be paid at the time of property purchase? +

The buyer needs to pay the following taxes at the time of registering the property:
• TDS or tax deduction at source on amount exceeding Rs 50 lakhs for the purchase of immovable property excluding agricultural land. The TDS must be submitted in the name of the seller.
• Stamp duty on registration
• Service Tax is applicable if the property is being purchased from the builder who conceived and constructed the project before offering possession to the buyer. If a ready-to-use property is purchased from the seller then service tax is not applicable.
• Value Added Tax (if applicable in the state)

What are the prevailing rates of different property taxes to be paid? +

TDS- 1% on the amount exceeding Rs 5o lakhs

Stamp duty depends on the state and municipal laws

Service tax- 12.36% if the property is being developed by a builder/developer as a service for buyers.

What is TDS or tax deduction at source on property? +

A new section 194IA has been inserted in the Income-tax Act, 1961 by the Finance Act, 2013. It provides for tax deduction at source on transfer of certain immovable property other than agricultural land of Rs. 50 lakh or more.

As per this new provision, any person, being a transferee responsible for paying to a resident transferor by way of consideration for transfer of immovable property other than agricultural land, shall at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, is required to deduct an amount equal to 1 percent of such sum as income-tax thereon specially when the value of the immovable property is Rs. 50 lakh or more.

How is TDS on property calculated? +

In terms of calculating the cost on which TDS needs to be calculated, everything paid to the seller in consideration for property is considered i.e.
• Basic cost
• Parking
• Fire-fighting equipment
• Electrification, wiring expenses etc.

Anything paid to the third parties or other authorities are excluded
• Stamp duty
• Registration fees
• Any payments to government authorities.
• Taxes charged by the builder

In case a ready property is being purchased from an end user, then everything paid to the seller in consideration for the property as per the agreement-to-sale is considered.

What are capital gains on property sale? +

The income tax rules define gain in two broad categories; namely short term capital gain (STCG) and long term capital gain (LTCG). Any gains arising by selling a property after holding it for 3 or lesser number of years, is short term capital gain. Any gains arising by selling the property after holding it for more than 3 years comes under long term capital gain.

For short term capital gain, the capital gain from asset is added to the investor’s income and taxed as per the income tax slab they fall under.

For long term capital gain, tax liability is determined based on indexed cost of acquisition and improvement. Indexation is a concept, which factors inflation in its calculation by using a factor called cost inflation index (CII).

How to calculate short term and long term capital gain? Is it calculated from the date of registration or from the date of possession? +

Possession certificate from the builder is what matters the most. Registration does not. The nature of the tax can be assessed based on the following two scenarios

During the under-construction phase
• When the buyers books the property rights by making an advance payment and makes subsequent payments to the developer as and when demanded and also with the progress in the construction then he gets the right to acquire a residential unit, and not a residential unit.

• The right is acquired by executing documents with the builder like allotment letter, or execution of builder-buyer agreement (whichever happens first).

• If the buyer has not obtained possession of the property, the right of the buyer would be in the nature of capital assets and accordingly, gain arising on such transfer would be in the nature of long term or short terms gain depending upon the period of holding. If more than 3 years, it is LTCG otherwise it is STCG.

• Section 54-F is applicable to exempt your capital gains from taxes i.e. entire sale proceeds net of expenses incurred to complete transfer would require to be reinvested to exempt capital gains from taxes.

After the possession of the property

• The unit becomes a residential house after the buyer obtains the possession from the developer. The nature of capital asset has changed – from rights to acquire to a residential house.

• Therefore, period prior to taking of possession is not to be considered.

• When you take possession of the flat which you have agreed to purchase, the right to purchase the flat gets converted into the flat itself. Therefore, if you sell the flat after taking possession, the period of three years begins/commences from the date of taking possession of the flat.

• Capital gains tax Long term or short term liability can accordingly be computed depending on period of holding of the right to own a flat or asset.

What is Stamp Duty and who is liable to pay the Stamp Duty? +

Stamp Duty is a tax, similar to sales tax and income tax collected by the government, and must be paid in full and on time. A stamp duty paid instrument/document is considered a proper and legal instrument/document. The liability of paying stamp duty is that of the buyer unless there is an agreement to the contrary.

Which instruments attract payment of Stamp Duty? +

The instruments like Agreement to Sell, Conveyance Deed, Exchange of property, Gift Deed, Partition Deed, Power of Attorney, settlement and Deed and Transfer of lease attract Stamp Duty on market value of the property.

Is Stamp Duty payable when a flat is transferred by way of a gift? +

Yes. Stamp duty will have to be paid if the flat is gifted by the donor.

From what date are the maintenance charges due? +

Maintenance charges usually get applicable from the date (or month in general) the possession is taken of the Property.

From what date is the Property tax due? +

Property tax is applicable from the date of execution of Property documents in favour of the owner.

What are non-occupancy charges? +

Non- occupancy charges become applicable to be paid if the ownership has been transferred by the Society/builder to the owner but the flat/unit is lying vacant even when it is in a ready- to- move condition.

What is the difference between Maintenance v/s holding charges? +

Maintenance charges are the charges either annually or monthly applicable to be paid by the owner once he/she has taken possession of the Property. These charges are paid for the general maintenance and upkeep of the building/society.
Holding charges are to be paid by owner/holder who is a non-occupying owner (has not yet occupied the property) to the Developer/society/ government development agency.

Is the buyer liable to pay labour cess? +

There is a central act called The Building and Other Construction Workers Welfare Cess Act, 1996 under which a Builder/contractor is bound to pay 1% of the cost of construction where the cost of building exceeds Rs. 10 lacs and more than 10 workers are employed. Since the liability is clearly cast upon these persons there is no case for recovering this from the flat buyer moreso when there is no obligation to pay under the agreement. You must definitely write to the builder and put these points on record in the event you wish to pursue the matter later before the consumer forum.

NRI Connect
How can NRIs invest in real estate? +

According to the regulations of FEMA and RBI, an NRI is allowed to do the following investments in property:

Any immovable property can be purchased by an NRI in India other than any agricultural land, farm house and plantation property.

He can get any immovable property as mentioned above by gift from Indian resident, Indian citizen residing outside India or person of Indian origin.

He can also obtain any property by the way of inheritance.

He can transfer immovable property to any resident of India by sale.

He can transfer any agricultural land, farm house or plantation land to any resident of India by gift.

He can also transfer his residential or commercial property by means of gift to any person either residing in India or abroad or person of Indian origin.

Can you sell the flat without registration? +

No. You cannot sell a property without proper registered document(s). A registered document is the authenticity and guarantee of the ownership over the property. Neither should one sell a property without proper registered documents and neither should one purchase a property wherein the seller does not have registered document of his/her ownership in the Property.

Do NRIs require permission from RBI to acquire property in India?+

RBI has issued a notification granting a general permission to NRIs for purchase of certain immovable properties in India without obtaining any specific permission from RBI.

Is there any restriction on the number of property units that an NRI can acquire?+

There is no restriction as to the number of residential or commercial property an NRI can acquire.

How to conduct the purchase procedure?+

A sale agreement must be drawn on a Rs 50 stamp paper, which will mention the final amount, advance payment, time limit to pay the due amount and details of installments.

Once the sale deed is completed, you need to get it registered at the sub-registrar or Sub-District Magistrate. The overseas buyer’s foreign address has to be mentioned in the sale agreement. He can appoint a representative in India (with a power of attorney) to act on his behalf. The power of attorney should be notarised with the Indian consulate in the buyer’s country of residence.

The property can be registered in the name of the NRI and the holder of the power of attorney can sign on his behalf by producing a copy of the document to the appropriate authorities.

What to check before buying a property in India?+

Few points of consideration are under:

Property name: The name of property should be clear from issues and the seller should have the required right to sell it, especially if it is inherited or any joint property.

No Dues Certificate: Always check that there will be no outstanding electricity/water bills or any other authority dues pending with the property. Take a no dues certificate from the seller at time of purchase.

Bank release letter: It is advisable to take the bank release letter from the concerned bank, if the property had been mortgaged as security in any type of loan.

Permits: The property of sale should have all approvals and permits from the civic authorities in terms of construction.

What are the sources to finance this purchase?+

The payment for purchase of permitted property by an NRI can be made by way of remittance through banking channels from abroad or from money lying in their NRE/NRO or FCNR account. The money for purchase of the permitted properties has to come only through banking channels hence the payment cannot be tendered in the form of traveler’s cheques or foreign currency. NRIs are even allowed to finance the purchase with home loan in Indian Rupees. The home loan can be granted by the Indian employer of the NRI employee for the purpose of financing of the property.

Are NRI/PIO/OCI eligible for Housing loans to buy property from any Indian Bank?+

An authorised dealer or a housing finance institution in India approved by the National Housing Bank may provide housing loan to a non-resident Indian or a person of Indian origin residing outside India. For acquisition of a residential accommodation in India, subject to the following conditions, namely:

The quantum of loans, margin money and the period of repayment shall be at par with those applicable to housing finance provided to a person residing in India.
b) The loan amount shall not be credited to Non-resident External (NRE)/Foreign Currency Non-resident (FCNR)/Non-resident non-repatriable (NRNR) account of the borrower.
(c) The loan shall be fully secured by equitable mortgage by deposit of title deal of the property proposed to be acquired, and if necessary, also be lien on the borrower’s other assets in India.

(d) The installment of loan, interest and other charges, if any, shall be paid by the borrower by remittances from outside India through normal banking channels , i.e., NRO/NRE account in India or out of rental income derived from renting out the property acquired by utilization of the loan or by any relative of the borrower in India by crediting the borrower’s loan account through the bank account of such relative (The word ‘relative’ means ‘relative’ as defined in section 6 of the Companies Act, 1956.)

(e) The rate of interest on the loan shall conform to the directives issued by the Reserve Bank of India or, as the case may be, the National Housing Bank.

f) A maximum of 80 per cent amount is financed by the financial institution. The rest should be given by the NRI.

g) The NRI has to repay his principal amount as well as interest part from that similar channel only.

Can Housing Loan of NRI / PIOs be repaid by close relatives of the borrower in India? +

Housing Loan in rupees availed of by NRIs/ PIOs from ADs / Housing Financial Institutions in India can be repaid by the close relatives in India of the borrower.

Who can be named as joint owner of the property? +

The property to be purchased by an NRI can either be purchased in single name or jointly with any other NRI. It may be noted that that a resident Indian or a person who is otherwise not allowed to invest in the property in India cannot even be made a joint owner in such property though the second named person might not even be contributing any money towards the property.

Are any documents required to be filed with the Reserve Bank after the purchase? +

No An NRI / PIO (Person of Indian Origin) who has purchased residential / commercial property under general permission, is not required to file any documents/reports with the Reserve Bank.

Can a non-resident owning or holding an agricultural land / a plantation property / a farm house in India sell the said property? +

NRI / PIO may sell agricultural land /plantation property/farm house to a person resident citizen of India.

Can an NRI sell inherited property? +

In case the property (irrespective of its nature) was acquired or inherited by you (the overseas Indian or NRI) when you were a resident of India, you can sell or build on the property without the approval of the Reserve Bank of India. However, if you wish to sell it, you must be a resident citizen of India.

What is the tax treatment for income generated from property selling or renting for NRI/PIO? +

The mere acquisition of property does not attract income tax. However, any income accruing from the ownership of it, in the form of rent (if it is let out)/annual value of the house (if is not let out and it is not the only residential property owned by that person in India) and/or capital gains (short term or long term) arising on the sale of this house or part thereof is taxable in the hands of the owner.

Does NRI/PIO have to file return in India for their property rental income and Capital Gains Tax? +

Rental income earned is taxable in India, and they will have to obtain a PAN and file return of income if they have rented this property. On sale of the property, the profit on sale shall be subject to 9 capital gains. If they have held the property for less than or equal to 3 years after taking actual possession then the gains would be short term capital gains, which are to be included in their total income as tax as per the normal slab rates shall be payable and if the property has been held for more than 3 years then the resultant gain would be long term capital gains subject to 20% tax plus applicable cess.

How is Rate of Capital Gains Tax computed?+

Rate of tax deduction at source (TDS)

Long term 20.6%

Short term 30.9%

Exemption available (only for long term capital gains)
The long term capital gains arising on sale of a residential house can be invested in buying/ constructing another residential house, within the prescribed time. The exemption is restricted to the amount of capital gains or amount invested in new residential house, whichever is lower.

What are the rules governing the repatriation of the proceeds of sale of immovable properties by NRI/PIO as prescribed by the Reserve Bank of India? +

If the property was acquired out of foreign exchange sources i.e. remitted through normal banking channels/by debit to NRE/FCNR(B) account, the amount to be repatriated should not exceed the amount paid for the property:

Repatriation of sale proceeds of residential property purchased by NRI’s/PIO’s out of foreign exchange is restricted to not more than two such properties. Capital gains, if any, may be credited to the NRO account from where the NRI’s/PIO’s may repatriate an account up to USD one million, per financial year, as discussed below.

If the property was acquired out of Rupee sources, NRI/PIO may remit an amount up to USD one million, per financial year, out of the balances held in the NRO account (inclusive of sale proceeds of assets acquired by way of inheritance or settlement), for all the bonafide purposes to the satisfaction of the Authorized Dealer bank and subject to tax compliance. The NRI/PIO may use this facility to remit capital gains, where the acquisition of the subject property was made by funds sourced by remittance through normal banking channels/by debit to NRE/FCNR(B) account.

If the immovable property was acquired by way of gift by the NRI/PIO, can he repatriate abroad the funds from sale of such property? +

The sale proceeds of immovable property acquired by way of gift should be credited to NRO account only. From the balance in the NRO account, NRI/PIO may remit up to USD one million, per financial year, subject to the satisfaction of Authorised Dealer and payment of applicable taxes.

If the immovable property was received as inheritance by the NRI/PIO can he repatriate the sale proceeds? +

Yes, general permission is available to the NRIs/PIO to repatriate the sale proceeds of the immovable property inherited from a person resident in India subject to the following conditions:

The amount should not exceed USD one million, per financial year (ii) This is subject to production of documentary evidence in support of acquisition / inheritance of assets and an undertaking by the remitter and certificate by a Chartered Accountant in the formats prescribed by the Central Board of Direct Taxes vide their Circular No.4/2009 dated June 29, 2009 (iii) In cases of deed of settlement made by either of his parents or a close relative (as defined in section 6 of the Companies Act, 1956) and the settlement taking effect on the death of the settler (iv) the original deed of settlement and a tax clearance / No Objection Certificate from the Income-Tax Authority should be produced for the remittance (v) Where the remittance as above is made in more than one installment, the remittance of all such installments shall be made through the same Authorised Dealer (vi) In case of a foreign national, sale proceeds can be repatriated if the property is inherited from a person resident outside India with the prior approval of the Reserve Bank. The foreign national has to approach the Reserve Bank with documentary evidence in support of inheritance of the immovable property and the undertaking and the C.A. Certificate mentioned above.

Is the rental income from property repatriable and what are the RBI rules? +

The rental income, being a current account transaction, is repatriable, subject to the appropriate deduction of tax and the certification thereof by a Chartered Accountant in practice.

Is repatriation of application money for booking of flat / payment made to the builder by NRI/ PIO allowed when the flat or plot is not allotted or the booking / contract is cancelled?+

The Authorised Dealers can allow NRIs / PIOs to credit refund of application/ earnest money/ purchase consideration made by the house building agencies/ seller on account of non-allotment of flat/ plot/ cancellation of bookings/ deals for purchase of residential, commercial property, together with interest, if any, net of income tax payable thereon, to NRE/FCNR account, provided, the original payment was made out of NRE/FCNR account of the account holder or remittance from outside India through normal banking channels and the Authorised Dealer is satisfied about the genuineness of the transaction.

Can one continue ownership of already acquired property after becoming an NRI? +

A person who owns a property when he becomes an NRI can continue to hold the property in his name. It is interesting to note here that such resident Indian becoming an NRI is even allowed to continue to own agricultural land, plantation property or farm house which he is otherwise not allowed purchasing after becoming NRI. An NRI is allowed to let out the property, which he owned when he became an NRI without taking any permission from RBI. An NRI is even allowed to get the money sent back outside India after appropriate taxes have been paid in India from rent so received.

Can residential / commercial property be mortgaged by NRI/ PIO? +

NRI / PIO can mortgage a residential / commercial property to:

An Authorised Dealer / the housing finance institution in India without the approval of Reserve Bank

A bank abroad, with the prior approval of the Reserve Bank.