If you are a Non-Resident Indian (NRI) planning to invest in real estate back home, experts’ advice careful and vigilant documentation while closing your transaction. 99acres.com shares a list of crucial documents necessary for NRIs looking to buy a property in India.
Among the several market instruments available in India, real estate has been a hot favourite for NRIs, primarily owing to their desire of owning a property in the homeland. The implementation of Real Estate (Regulation and Development) Act (RERA) is expected to further propel NRI investments in the forthcoming quarters, shares Tamil Selvan, Co-partner of NRI property management company, Propertism. If you too are looking to invest in India while settled abroad, the information about the formal procedure and the related documents will come handy, especially if you are investing in a residential property.
Passport or PIO Card
NRIs encounter more regulatory barriers than domestic investors, therefore it is mandatory to have a passport to invest in the Indian property market. However, if you are a person of Indian origin (PIO) or Overseas Citizenship of India (OCI), you are required to present the respective PIO and OCI cards.
You can apply for these cards in the Indian Embassy or with the foreign consulate of your country. Also, you will need to produce your parent’s birth certificates to prove your PIO or OCI status.
Power of Attorney
Being an NRI, you do not have to be physically present in India in order to complete the property transaction. Anyone can fulfill the formalities on your behalf who holds the ‘Power of Attorney’ (PoA) to act. The document gives an individual the power to act on behalf of the NRI which is mentioned in the deed. The person who provides the power is referred to as a ‘Donor’, ‘Principle’ or ‘Grantor’; and the person to whom the right is granted is addressed as ‘Donee’, ‘Agent’, or ‘Attorney’.
- The power of attorney should be executed on a stamp paper duly signed by the NRI before the consulate or the lawyer of the country where he is residing
Further, the deed should be then attested by the solicitor and sent to India for adjudication (registration of PoA in the registrar’s office to avoid any misuse by the donee) within three months of execution. The current norms of POA have become stricter owing to the recent policy changes such as RERA promoting transparency and accountability.
Your Permanent Account Number (PAN) card is essential if property purchased is leased out. Besides, if you plan to sell out the property in future, the capital gains arising from the sale of the property would be subject to capital gains tax. NRIs have to fill the Form 49A which can be easily accessed, filed and submitted online on the websites of UTI Infrastructure Technology and Services Limited (UTIITSL) and National Securities Depository Limited (NSDL). Total of Rs 107 is charged as a fee if the communication address provided by the NRI is within India and Rs 989, if it is outside India.