AS per a statement issued by
the Government today, it has come to notice of the
Central Government that foreign nationals are buying immovable property
illegally in some parts of the country. Many organizations and social groups
have also made representations to the Central Government expressing their
serious concerns in this regard.
It has also been observed that foreign
nationals coming to India and staying beyond 182 day on a tourist or other visa
meant for a certain period are illegally acquiring immovable property in India
in violation of the extant rules and regulations under FEMA.
As per the
provisions contained in Foreign Exchange Management (Acquisition and Transfer of
Immovable Property in India) Regulation 21/2000 (Notification No. 21/2000-RB
dated 3rd May, 2000), an Indian citizen resident outside India and a Person of
Indian Origin resident outside India may acquire immovable property in India
other than agricultural land, plantation or a farm house. A foreign company
which has established a Branch Office or other place of business in India under
the provisions of Foreign Exchange Management (Establishment in India of Branch
or Office or Other Place of Business) Regulations, 2000 (FEMA 22/2000-RB dated
the 3rd May, 2000) can acquire immovable property in India which is necessary
for or incidental to carrying on such activity, subject to the conditions
stipulated in Regulation 5 of Foreign Exchange Manage (Acquisition and Transfer
of Immovable Property in India) Regulations, 2000 (Notification No.21/2000-RB
dated the 3rd May, 2000).
Apart from above, a foreign national who is
residing in India for more than 182 days during the course of the preceding
financial year for taking up employment or carrying on business/vocation or for
any other purpose indicating his intention to stay for an uncertain period can
acquire immovable property in India as he would be a ‘person resident in India'
as per Section 2(v) of FEMA 1999. To be treated as a person resident in India
under FEMA a person has not only to satisfy the condition of the period of stay
(being more than 182 days during the course of preceding financial year) but
also his purpose of stay as well as the type of Indian visa granted to him to
clearly indicate the intention to stay in India for an uncertain period. In this
regard, to be eligible, the intention to stay has to be unambiguously
established with supporting documentation including visa.
Further,
person acquiring immovable property have to fulfill the requirements, if any,
prescribed by the State authorities.
In view of the above, all,
including the authorities concerned in the State Governments, are hereby advised
to be extra vigilant in such matters and satisfy themselves about the
eligibility under FEMA before registering sale or purchase of immovable property
in India. The enquiries may include both the intending buyers and sellers. The
relevant travel documents and the nature of visa may also be verified before
registering such sale/purchase.
Where appropriate, the authorities may
consider reviewing registration of sale/purchase already made to determine their
compliance with legal requirements.
In the event of any doubts,
Department of Economic Affairs in Ministry of Finance may be consulted for
clarification.
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