Rules For Buying Apartments For Sale in Mohali For NRI

by Akshay Rathore Digital Manager

An Indian citizen residing outside India does not need any permission for buying property in India, but in cases of plantation, agricultural, farm house property there are some conditions which are supposed to be followed properly.

An NRI do not need any permission to transfer commercial, residential property legally acquired by him in India and in Mohali by way of gift to a person resident in India or to person resident outside India who is a citizen of India or to an NRI.

A person of Indian origin residing outside India or An NRI does not need any permission to acquire apartments in mohali, from a person resident outside India who had acquired such property.

In the event of sale of immovable property i.e. apartments for sale in mohali Chandigarh, not including Plantation property, Agricultural land, Farm house in India by a person resident outside India, who is a person of Indian origin or citizen of India, the authorized dealer may allow repatriation of the sale proceeds outside India, provided All the following conditions are satisfied.

If the immovable property was acquired by seller in accordance with the provisions of the Exchange Control Rules/Regulations/Law in force at the time of acquisition, or the provisions of the Regulations framed under the Foreign Exchange Management Act, 1999.

Within a period of 90 days from the date of purchase of apartments for sale in Mohali or final payment of purchasing, they are need to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai, along with a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.

Tax Exemptions

Section 54 - This section stipulates that if NRI sells his or her apartments for sale in Mohali after three years from the date of purchase and reinvest the proceeds into another residential property within two years from the date of sale, the profit generated is exempt to the extent of the cost of new property.

To illustrate - if the capital gains is Rs. 10 lakh and the new property costs Rs. 8 lakh, the remaining Rs. 2 lakh are treated as long term capital gains. The sold apartments for sale in Mohali may be either have been self-occupied property or given on rent. The new property must be held for at least three years.

NRIs cannot invest the proceeds on thesale of Apartments in Mohali in India in a foreign property and still avail the benefit of Section 54. However, some recent hearings with the appellate authorities have held that exemption can be claimed under Section 54 even if the new house is purchased outside India.

However, this is not particularly clear under the law, and it is suggestable for an NRI to consult an expert in taxes or a Chartered Accountant before he/she makes any investment decisions outside India to avail of tax benefits under Section 54.

Section 54EC - This section of the Income Tax Act states that if an NRI sells a long term asset (in this case, an apartment in mohali) after three years from the date of buying the property, he or she will be exempt from capital gains tax. The bonds will remain locked in for a period of three years.