FAQ

Yes. If banks/financial organizations require further information from you, they will either send you the relevant forms or direct you to a website where you can download them.

In general, customers should supply the requested documentation and information by the date contained within the communication.

Banks/Financial organizations need to be committed to being fully FATCA compliant in all countries
where these operate.
The banks/financial organizations Group may not open new accounts or offer additional products and
services to customers who choose not to comply with banks/financial organizations requests for
documentation to establish a customer’s status under FATCA.

In accordance with the FATCA regulations, banks/financial organizations may exit the relationship with
customers who decide not to provide the necessary information and documentation within the
regulatory timeframe.
BANKS/FINANCIAL ORGANIZATIONS may need to report information about customers who do not
provide the required documentation to us.
In addition, Banks may also be required to withhold tax on certain US source payments coming into your
account

Banks / Financial Organizations will continue to review the impact of the legislation for our customers and will correspond with affected customers in due course. For more information regarding FATCA, please visit the IRS website, or contactus for advice.
Please note that you may receive more than one request for documentation if you have multiple relationships with different members of the banks/financial organizations Group. It is important that you respond to all requests, even if you believe you have already supplied the requested information.

Foreign Account Tax is meant only for US persons with threshold-limited accounts in India. Assets include investments and partitioned/inherited family assets in India –

• Individuals with bank or investment account balance above $50000.
• US person living in India with bank or investment account balance above $200000.
• Entities with bank or investment account balance above $250000.
• Immovable properties like land o1r house property, and personal assets like jewellery are not covered by FATCA
• Investment in partnership or proprietorship firm not included and not reported.

Ans. Tax benefits available to NRI are as follows. Bank Deposits are free from wealth tax in India.

Interest earned on NRE and FCNR accounts is exempt from Indian income tax upto 31st March 2005.

Gifts made out of NRE and FCNR accounts are free from gift tax in India. (Gift tax has been abolished for all types of gifts from the 1st October 1998)

However, Any gifts received, either in cash or in cheque or any other mode, on or after 1st September 2004, in excess of Rs.25, 000/- would be taxed in the hands of the recipient. However, gifts received on marriage or from relative or under will or inheritance or from employer in recognition of the servicesrendered would not be subject to tax.

NRI is required to file the return of income in India by 31st July.

A person earning any income has to pay tax in the country in which the income is earned (as Source Country) as well as in the country in which the person is resident. As such, the said income is liable to tax in both the countries. To avoid this hardship of double taxation, Government of India has entered into
Double Taxation Avoidance Agreements (DTAA's) with various countries  DTAA's provide for the following reduced rates of tax on dividend, interest, royalties, technical service fees, etc., received by residents of one country from those in the other.

Where total exemption is not granted in the DTAA's and the income is taxed in both countries, the country in which the person is resident and is paying taxed, the credit for the tax paid by that person in the other
country is allowed.  Where tax relief has been given by one country, the country of residence generally allows credit for the so ‘spared’, to avoid nullifying the relief.

As your total income is less than 2 Lakh Rs, you are not liable to file return. However you can cliam refund of Rs 30,000/- of your TDS deducted for which you should file return. If you are expecting a refund, make sure that you put accurate bank details such as account number and IFIC code of the branch as refunds are processed electronically

If the property is more than 3 years old, long term capital gains tax will be incurred on the sale of the property. On long term capital gains, tax is payable @ 20%. However, tax can be minimised by making alternative investments in India.

Profits earned by selling property in India will be liable to Capital gain is the difference between the sale value of the property and its cost of purchase. Capital gains can be classified as short term (up to 36
months) or long term (more than 36 months), depending on the period for which the property is held. Short-term capital gain will be taxed at normal slab rates and long-term gain will be taxed at 20%.

If a residential property is sold after being held for more than three years and the proceeds are reinvested for purchase of a new residential property, then the capital gains will be exempt to the extent of the amount reinvested. The exemption is subject to the new property being purchased within a year
before or two years from the date of sale, or if new property is being constructed within three years from the date of sale.

For returning Indians, funds held in fixed deposits in NRE accounts, interest will be payable at the rate originally fixed, provided the deposit is held for the full term even after conversion into resident account. However, the interest earned after the status was updated to resident will be taxable.

The capital gain is leviable in respect of urban property or the land which falls within the radius of 8 KM of municipal area. Beyond 8 Km from the municipal area, it is exempt

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 it 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.

You can bring your earnings as you wish. You should take care of income tax of your earnings. After you are return to India, your income earned outside India will not be taxable in India provided it is received in India for two years. After the two years, your worldwide income would be taxable in India

Yes Investment in the specified bonds is to be made within six months of such sale and there is a lock-in period of three years for such bonds.

The following are some items of income of NRIs that are exempted from tax under the provisions of the Income Tax Act.
1. Interest on Non Resident External (NRE) Account and Deposits.
2. Interest on foreign currency deposits {FCNR (B)} Deposits.
3. Interest on notified Relief Bonds.

4. Other notified Bonds and Certificates.
5. Dividends on shares of domestic companies.
6. Income from specified Mutual Funds.
7. Long Term Capital Gains on sales of shares of Indian Co/Equity Oriented Mutual Funds on a recognized stock exchange.
8. Other items specified in Section 10 of the Income Tax Act.

A special tax regime is available for NRIs in respect of income arising from investment in specified assets purchased with convertible foreign exchange. The specified assets are as under:

i. Shares in an Indian company.
ii. Debentures issued by a public limited Indian company.
iii. Deposits with a public limited Indian company.
iv. Securities of the Central Government.
v. Any other notified assets.

Where a person, who is a non-resident Indian in any previous year, becomes assessable as resident in India in respect of the total income of any subsequent year, he may furnish to the Assessing Officer a declaration in writing along with his return of income 46  under section 139 for the assessment year for which he is so assessable, to the effect that the provisions of this Chapter shall continue to apply to him in relation to the investment income derived from any foreign exchange asset being an asset of the nature referred to in sub-clause (ii) or sub-clause (iii) or sub-clause (iv) or sub-clause (v) of clause (f) of section 115C; and if he does so, the provisions of this Chapter shall continue to apply to him in relation to such income for that assessment year and for every subsequent assessment year until the transfer or conversion (otherwise than by transfer) into money of such assets.

An NRI is required to furnish his/her return of income, if his/her total taxable income exceeds the maximum amount which is not taxable.

A non-resident Indian is not required to furnish return of income, if –
a. Total income consists only of investment income from foreign exchange assets or long-term capital gains under special tax regime or both.
b. Tax has been deducted at source on such income.

NRI has opted to be governed by the special tax regime

An Indian Citizen who stays abroad for employment/carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad is a non-resident. Non-resident foreign citizens of Indian Origin are treated on par with Non Resident Indian citizen (NRIs).

NRI is required to file the return of income in India by 31st July.

Under the general permission available, the following categories can freely purchase immovable property in India:

Non-Resident Indian (NRI)- that is a citizen of India resident outside India

Person of Indian Origin (PIO)- that is an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan), who

at any time, held Indian passport or

who or either of whose father or mother or whose grandfather or grandmother was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955).

The general permission, however, covers only purchase of residential and commercial property and notfo r purchase of agricultural land / plantation property / farm house in India.

No. Since general permission is not available to NRI/PIO to acquire agricultural land/ plantation property / farm house in India, such proposals will require specific approval of Reserve Bank and the proposals are considered in consultation with the Government of India.

An NRI can transfer / remit out of the NRO account subject to production of documentary evidence in support of acquisition by the remitter and an undertaking by the remitter along with a certificate by a chartered  accountant, However Form 15CA and 15CB is not compulsory in such cases.

As per regulations, NRI are permitted to transfer a maximum of $1 million per financial year to your NRE account. The transfer will be subject to payment of applicable taxes. So far the amount being transferred to the NRE account represents balances for which tax has already paid or exempt there shouldn’t be additional tax.

Non-Resident (External) Rupee (NRE) is a Rupee account using which the funds can be repatriated. It means that the account can be started with funds which can be either transmitted to abroad or from abroad. Non-Resident Ordinary Rupee (NRO) is a Rupee account which can be initiated with funds which are remitted either from abroad or are generated in the country itself. The striking feature is that the amount in this account is non-repatriable. However, funds in NRO account can be repatriated based on the rules that are being followed at the time of repatriation.

Overseas Corporate Bodies (OCBs) are bodies predominantly owned by individuals of Indian nationality or origin resident outside India and include-overseas companies, partnership firms, societies and other
corporate bodies which are owned, directly or indirectly, to the extent of atleast 60% by individuals of Indian nationality or origin resident outside India as also overseas trusts in which atleast 60% of the beneficial interest is irrevocable held by such persons.

Such ownership interest should be actually held by them and not in the capacity as nominees. The various facilities granted to NRIs are also available with certain exceptions to OCBs so long as the ownership/beneficial interest held in them by NRIs continues to be atleast 60%.

Yes, provided the funds for the purpose are drawn out of their Resident Foreign Currency Accounts

No. Resident donees or legal heirs of the persons covered under the general permission/exemption granted by the Government of India can continue to maintain their foreign currency assets provided in the case of gift the resident donee is a relative, i.e., husband, wife, brother, sister or any lineal ascendant or descendant of the donor and the tax, if any, has been paid in India. Resident donees not eligible for the exemption should surrender the foreign exchange to an authorised dealer against payment in rupees.

This is a Scheme drawn up by the Reserve Bank permitting Returning Indians to open foreign currency accounts with banks in India for holding funds brought by them to India. This facility replaces the earlier (RIFEE) facility.

Yes. NRIs can take out of India precious stones and jewellery (both gold and non-gold) purchased by them in India, without any limit, provided the purchase is made against payment in any convertible foreign currency.

NRO account can be held jointly with resident Indians. NRE account cannot be held jointly with resident Indian; however a power of attorney to operate the account can be given by NRI in favour of a resident Indian.

NRIs can make portfolio investments in shares and Debentures quoted on the Stock Exchanges in India with full benefits of repatriation of capital and income thereon subject to the following conditions. Portfolio investments in shares/debentures by NRIs/OCBs are permitted only through  esignated
branches of authorised dealers preferably located at centres having stock exchanges. Authorised dealers should inform the names of such branches to Central Office of Reserve Bank and obtain approval. The Code number allotted by Reserve Bank should be quoted in all correspondence  ndertaken with Reserve Bank in this regard. Non-resident investors can also authorise Indian residents or stock exchange brokers as their agents in India to purchase/sell shares on their behalf under the schemes but all transactions should be routed through the designated branch of authorised dealer.

The payment is received through an inward remittance in foreign exchange or by debit to the investor's NRE/FCNR account. Investment made by any single NRI/OCB investor in equity/preference shares and convertible debentures of any listed Indian company does not exceed 5% of its total paid-up equity or preference capital or 5% of the total paid-up value of each series of convertible debentures issued by it. NRIs/OCBs take delivery of the shares/convertible debentures purchased and give delivery of the shares/convertible debentures sold under the Scheme

No. Indian companies have been granted general permission to accept investments on non-repatriation basis, in shares/convertible debentures by way of new/rights/bonus issue provided the investee company does not carry on agricultural/plantation activity and/or real estate business (excluding real
estate development i.e. development of property and construction of houses).

A person who has acquired the property U/s 6(5) of FEMA or his successor cannot repatriate the sale proceeds of such property without RBI approval. However, repatriation up to USD I million per financial year is allowed, along with other assets under (Foreign Exchange Management (Remittance of Assets) Regulations, 2016) for NRIs/ PIOs and a foreign citizen (except Nepal/ Bhutan/ PIO) who has (a) inherited from a person referred to in section 6(5) of FEMA, or (b) retired from employment in India or(c) is a non-resident widow/ widower and has inherited assets from her/ his deceased spouse who was an Indian national resident in India.

NRIs/ PIOs can remit the sale proceeds of immovable property (other than agricultural land/ farm house/ plantation property) in India subject to the following conditions:

The immovable property was acquired in accordance with the provisions of the foreign exchange law in force at the time of acquisition by him or the provisions of Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations 2000;

No, NRIs or Indians living abroad are not eligible for Aadhaar Card. The Aadhaar is only for resident Individual i.e. people living in India. You must be living for more than 182 days in last 12 month to apply for Aadhaar card. See here to learn more about this issue.

NRIs are not eligible for Aadhaar card but PIOs and OCI, which are currently living in India are eligible for Aadhaar card. They are the people who doesn't hold Indian passport. They can go to any local Aadhaar center and apply there. You also need to go for biometeric scan hence in person presence is required for applying Aadhaar card.

In order to apply for Aadhaar card you need ID, Address, and proof of Date of birth. You can give rent agreement or utility bills for address proof if you are currently living in India. As I said before, NRIs are not eligible for Aadhaar card in India.

No, its not. Since NRIs cannot apply for Aadhaar card, they are also exempted by Income tax department to link Aadhaar with PAN card. Btw, if you already have both Aadhaar and PAN card, then you should link them e.g. you may have got them when you are resident of India but now you are an NRI.

Again,,its not mandatory for NRIs to quote 12 digit Aadhaar number while filling income tax return in India. Since they are not eligible to apply for Aadhaar card, government has exempted them for mandatory quoting of Aadhaar number in their income tax return. See here to learn more about this
issue.

For resident Indians, if you fail to link PAN card with Aadhaar then PAN will be cancelled but for NRIs, who doesn't have Aadhaar card, there is no mandatory requirement to link with PAN card, hence I believe there PAN card will not be cancelled.

No, it's not. As I have said before, NRIs, PIOs and OCI are not eligible for Aadhaar card if they are staying outside of India. Aadhaar is only for people living in India, though if OCI and PIO are living in India they can apply for Aadhaar and yes it's mandatory for them.

If you are an NRI but hold Aadhaar card, probably you got that before you become an NRI, you should link your PAN card to Aadhaar. You can do that online in just a couple of steps.

No, you cannot cancel Aadhaar card. Once generated, Aadhaar number is for life.

Yes, since NRIs are not eligible for Aadhaar card, respective government department has to give them exemption on Aadhaar number. Hence, if you are an NRI and don't have Aadhaar but need PAN card, I believe you can still apply.

Follow the steps given here to link your Aadhaar card with PAN card online.
Step 1:
Just go to www.incometaxindiaefiling.gov.in and login to your profile, then go to the profile setting and click on the drop down menu – Link Aadhaar
Step 2:
Provide PAN, Aadhaar no. and enter your name as given in Aadhar card (avoid spelling mistakes) and submit. After verification from UIDAI which is the government website for Aadhaar and maintains all your personal data, the linking will be confirmed.
If there is any minor mismatch in the name provided in Aadhaar card, an Aadhaar OTP will be required. Please ensure that the date of birth and gender in PAN and Aadhaar are exactly same. Once you do this, it
will display the message that "PAN card and Aadhar linking is successful".
In a rare case where Aadhaar name is completely different from name in PAN, then the linking will fail and the taxpayer will be prompted to change the name in either Aadhaar or in the PAN database.

That's all about whether it's mandatory for NRIs to link PAN card with Aadhaar or not. It's not mandatory if you don't have Aadhaar card and don't intend to apply for it in near future. If you living outside India, obviously you cannot apply until you go to India. You also need to make a declaration that you are not an NRI. But, if you have an Aadhaar card and PAN card, it's better to link both of them online.

In order to Link Aadhaar with PAN, your demographic details – Name, Gender and Date of Birth should match. We request you to please get your Name Spelling Corrected in appropriate document i.e. PAN or Aadhaar and try to link again. In-case linking problem still persists, we request you to please get in touch with Income Tax department incometaxindia.gov.in or visit https://www.utiitsl.com

UIDAI's official website i.e. www.uidai.gov.in doesn't have any such restriction and should be accessible from anywhere. However, some of the UIDAI web based features like Resident Portal, eAadhaar, Self

Service Update Portal (SSUP), Aadhaar Linking Status etc are Geo-Based policy enabled and therefore, will not be accessible from outside India.

That's all about some of the frequently asked questions related to Aadhar card, PAN card, their linking and income tax for NRIs in general. As I said, since NRIs are not eligible for Aadhaar card in first place,
they are exempted from quoting the 12 digit Aadhaar number in their income tax return. They are also exempted from linking their PAN card with the Aadhaar card, if they don't have any and don't intend to apply for Aadhaar in near future. They can also apply for PAN card from 1st July 2017 without Aadhaar card.

Yes, you can check the status of Aadhaar card online by accessing the UIDAI's official website. Though, beware, it may not be accessible outside India

For NRIs it is suggested that they disclose their non-resident status with proof to their bank. For the status of account becoming in-operational only the relevant banks shall be able to give response.

Section 139AA of the Income-tax Act, 1961 as introduced by the Finance Act, 2017 provides for mandatory quoting of Aadhaar / Enrolment ID of Aadhaar application form, for filing of return of income and for making an application for allotment of Permanent Account Number with effect from 1st July, 2017.

It is clarified that such mandatory quoting of Aadhaar or Enrolment ID shall apply only to a person who is eligible to obtain Aadhaar number.

As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, only a resident individual is entitled to obtain Aadhaar. Resident as per the said Act means an individual
who has resided in India for a period or periods amounting in all to one hundred and eighty-two days or more in the twelve months immediately preceding the date of application for enrolment. Accordingly, the requirement to quote Aadhaar as per section 139AA of the Income-tax Act shall not apply to an individual who is not a resident as per the Aadhaar Act, 2016

Downloaded Aadhaar or e-Adhaar carries Name, Address, Gender, Photo and Date of Birth details of the Aadhaar holder in similar form as in Printed Aadhaar letter. The e-Aadhaar also contains date of Aadhaar
generation & date of e-Aadhaar download. The downloaded Aadhaar or e-Aadhaar is a digitally signed document by UIDAI as per IT Act, 2000 which provides for legal recognition of electronic records with digital signatures.

Hence Downloaded Aadhaar /e-Aadhaaris a valid and secure electronic document which should be treated at par with printed Aadhaar letter.

As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, only a resident who has resided in India for a period or periods amounting in all to 182 or more in the 12 months immediately preceding the date of application for enrolment.

UIDAI only issues Aadhaar and provides means to authenticate the same. For any product or scheme related queries, we request you to please get in touch with respective product/scheme owner.

For PAN related queries, you are requested to please contact with Income Tax
department incometaxindia.gov.in or visit https://www.utiitsl.com

And if they don't have their own residential address in India now?
As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016,  only a resident who has resided in India for a period or periods amounting in all to 182 or more in the 12 months immediately preceding the date of application for enrolment.

Note:For PAN data update related queries you may visit: https://www.utiitsl.com.

For Aadhaar update related information you may visit UIDAI official website: www.uidai.gov.in

As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, only a resident who has resided in India for a period or periods amounting in all to 182 or more in the 12 months immediately preceding the date of application for enrolment.

As per the latest judgment of the honorable supreme court of India, sale of property by PoA is restricted through blood relation only, i.e sibling, children or parents. It is not valid through third party

Now the NRI partition cases in Punjab are taken up by District Revenue Officer (DRO) in each district in Punjab. This was previously taken up by Tehsildars

A compromise deed is a compromise between the two parties which is made after negotiation and the content thereof are documented and registered before the Sub Registrar. The compromise deed is a legal document and enforceable in law.

In such cases sale done in good faith has to be challenged in civil suit and evidence has to be given to prove that money is not received.

As per latest notification from Punjab government, if the land is hereditary or has been purchased more than 5 years ago, the same can be got vacated from any person (including relative or tenet) by filing case before Sub District Magistrate, SDM.

No, any person, even not a relative of NRI can appear on the buyers behalf before Thasildar while purchasing a property in Punjab.

NRI has to be present or he has to issue Power of Attorney to his Blood relation with specific incorporation of power to sale in PoA.

A compromise deed is a compromise between the two parties which is made after negotiation and the content thereof are documented and registered before the Sub Registrar. The compromise deed is a legal document and enforceable in law.

1) A registered Will: As per legal requirement, a Will is not required to be registered. It can just be written on a plain piece of paper. However, registration makes it a valid document that can be presented in the court. “We recommend that the Will is registered. One can always keep revising a registered Will,”

2) A succession certificate: In the absence of a Will, the heirs would need to obtain a Succession certificate from the court.
“The heirs will have to submit various documents such as death certificate of the deceased, the birth certificate of the heirs, copy of the ration card, bank statement of the heirs etc. These documents are needed to prove that the heirs are indeed the rightful successors,” Sunder says.

3) Original purchase deed of property and registration documents: In case of old properties, the original purchase deed may not be available. In such cases, you would need to procure certified copies of the title deed from the jurisdictional registrar’s office.

4) Encumbrance certificate: The Encumbrance Certificate records and reflects all the transactions occurred in respect of an immovable property be it a sale, lease, mortgage, gift, partition, release, etc.

5) Khata: Khata is a record that shows the entry of the property owners details in the records of the Corporation/Municipality. It contains details such as name of property owner, type of property, property taxes paid/ payable etc. It is basically an evidence of who owns and possesses the property concerned.

The registration document shows the purchase or sale of the property from one owner to another with various rights thereon, whereas the Khata shows the annual property taxes paid. Ideally, when registration of a property changes, automatically the Khata should also be changed in the municipal
records. Unfortunately, that automatic process does not happen and Khata must be transferred separately.

“Transfer of title can be done through mutation of revenue records/ transfer of Khata,”
Mutation of revenue records means updating the details of new owner of the property in the books of the respective development authority, that is, either the municipal corporation or the village panchayat.
In order to do this, you must submit all the documents mentioned above to the authority.
“While the transfer must be effected locally, that is, within India and within the same jurisdiction where the immovable property is situated, it can be executed by an NRI using a Power of Attorney (PoA),”
“For the succession certificate too, the NRI can have someone represent him/her through the PoA.”

1) Ensure that a Will is made and duly registered. One can always draft a fresh Will anytime and have it registered again. The last registered Will is the one that will be used.
2) Ensure property matters are discussed and clarified between siblings so that there are no complicated legal wrangles later on.
3) Ensure that documentation required for each property to establish ownership is mandatorily done. “In some cases the property continues in peaceful enjoyment without mutation (transfer of records to the next successors) for generations. That kind of a situation is a time bomb waiting to explode should relationships go bad. And the more the number of successors, the more the complications,”
“For NRIs, the biggest challenge is about tackling the unknown. It is important to understand and accept the systems and processes in India. Having lived abroad for several years, one gets used to a certain way
of doing things. There is no right way or wrong way anywhere. It is just about getting accustomed to the local way. There is no point in trying to fight the local bureaucracy. I would only suggest that you consult a local lawyer who understands the system or avail the services of professional organizations. It is well worth it,”

Benami means ‘anonymous’ or ‘without name’ in Hindi. A Benami property refers to property bought in the name of a secondary person (benamidaar) so as to conceal the identity of the real buyer (beneficial owner). Individuals generally purchase Benami properties in the name of relatives/third parties to conceal the extent of their wealth from the government

Under the Act, a transaction is named ‘benami’ if property is held by one person (benamidaar), but has been provided or paid for by another person (beneficial owner).Act defines Benami property as:

• A transaction carried out under a fictitious name;
• Where the person in whose name the property is registered denies any knowledge of ownership or;
• Where the person paying for a transaction or property-related arrangement is either not traceable or found to be fictitious.

This definition can, however, expand to include relatives or associates who have properties under their name, which they did not pay for. Furthermore, the Benami Act, 2016 does not limit Benami properties to immovable properties, it includes all kinds of financial and non-financial assets.

People caught with benami properties could end up with up to seven years of rigorous imprisonment and pay a significant fine of 25% of the fair market value of the benami property involved. Additionally, the properties will be confiscated.

A person could also face rigorous imprisonment for up to five years for knowingly giving false information and will have to pay a fine of up to 10% of the market value of the property. What this means is that a property worth Rs 1 crore will attract a penalty of Rs 25 lakh and seven years of imprisonment.

So far, the common concerns of the NRIs investing in India, have been the non transparent nature of the business, lack of information, no concept of standardised due diligence, untimely delivery and completion of projects. Thus implication of the Act will increase professionalism and the tag of corruption and unaccounted wealth, which follows most developers, will hopefully, be limited to a few unethical players.With increased  transparency, title risks will reduce, thereby boosting genuine buyer
confidence.Rouge investors will be pushed out of the market, thereby, leading to a more end-user driven market and a scaling down of inflated prices. Thus it will be an easy task for the NRIs to purchase and
manage their properties in India

Before transferring money or property to someone else, relative or not, please define the nature of transfer; i.e. whether it is a loan, gift or income. The rules, requirements and conditions as per applicable laws for the respective nature need to be complied with. It is important to realize that as Income Tax returns are filed individually, there is no “joint” concept in true sense and is mainly for convenience in India. Person who has invested the money is considered the real owner

NRI property buyers can expect clean deals in such an organized market and steer clear of any fishy transactions that may lead to regretful situations at a later stage. NRIs investing in India should be careful and seek professional assistance before executing deals since “penalties are draconian” and include fines, prosecution, and confiscation of property

If by mistake, you have entered into a Benami Transaction, seek an experienced professional help to remedy the same

Examples of Benami Transactions

Mr. A, an NRI and a resident of USA, gives a gift of Rs. 10,000,000 from his NRO account to his resident father, who invested in mutual funds in his own name as a single owner in India, with an intention to return the gift amount to his son in future, is a Benami Transaction

Mr. F, an NRI and a resident of Germany, invested in equity shares of various listed companies of Rs.10,000,000 in name of his wife Mrs. Heena and himself as joint holders from an account not disclosed to tax authorities (unknown source), is a Benami Transaction

Mr. H an Indian resident, held PPF account of Rs. 3,000,000 in name of his granddaughter, who is an NRI and a resident of UK as a single owner, is a Benami transaction. Also, it is not legal as NRIs are not allowed
to open a PPF account

Mr. I, an NRI and a resident of USA, held corporate deposits of Rs. 2,500,000 in name of his brother’s wife or wife’s brother as first holder and himself as second holder is a Benami transaction.

Mr.O, an NRI from Switzerland sold a Benami property for Rs. 50,000,000 by cheque and deposited the sale proceeds in his NRO bank account. The amount in the bank account is a Benami property.

Mr.Q has owned a Benami office property since 2010. As he is still holding the property on Nov 1, 2016, this would also be considered as a Benami transaction as per the new amended act and will be subject to the authority and penalty of the amended act.

Advice:
1. Please do not be complacent and think that “nothing will happen to you” or “this is how things are done in India” or “I am a very small fish” or “no one will know” or “I have done this many times in past”, etc.
2. Before transferring money or property to someone else, relative or not, please define the nature of transfer; i.e. whether it is a loan, gift or income. The rules, requirements and conditions as per applicable laws (e.g. FEMA, Income Tax, etc.) for the respective nature need to be complied with.
3. It is important to realize that as Income Tax returns are filed individually, there is no “joint” concept in true sense and is mainly for convenience in India. Person who has invested the money is considered
the real owner. Please ensure that the transaction is not a Benami Transaction
4. If by mistake, you have entered into a Benami Transaction, seek an experienced professional help to remedy the same
5. NRI property buyers can expect clean deals in such an organized market and steer clear of any fishy transactions that may lead to regretful situations at a later stage
6. NRIs investing in India should be careful and seek professional assistance before executing deals since “penalties are draconian” and include fines, prosecution, and confiscation of property
7. New property buyers should consult legal professionals before purchasing joint property or property under the name of relatives