Rules that Simplify Property Buying for NRIs in India

It makes sense for non-resident Indians (NRIs) and persons of Indian origin (PIOs) to invest in
property in India. A NRI is a person who is not resident in India. According to the Foreign
Exchange Management Act (FEMA), ‘person resident in India’ includes a person residing in
India for more than 182 days during the course of the preceding financial year. It does not
include a person who has gone out of India on employment, business or vocation, or for any
other purpose for an uncertain period.
Also, a person who has come to stay in India other than on employment, business or vocation, or
for any other purpose for an uncertain period. All other persons are NRIs. NRIs are permitted to
buy and sell property in India. The acquisition and transfer of property by NRIs should be in
accordance with the FEMA. The property should be purchased through a registered conveyance
deed. It may also be purchased on a power of attorney. In the latter case, an agreement to sell and
a power of attorney are executed by the seller in favour of the buyer.
NRIs do not require permission of the Reserve Bank of India (RBI) to acquire residential or
commercial property in India. The RBI has granted general permission to foreign citizens of
Indian origin, whether resident in India or abroad, to purchase property in India for their bona
fide residential purposes. The payment has to be made either out of inward remittances in foreign
exchange through normal banking channels or out of funds in a NRE or FCNR account
maintained with a bank in India.

Imposition of MAT can make SEZs Unattractive for

Exporters
The imposition of minimum alternate tax (MAT) on special economic zones could make them
unattractive for exporters as incentives available outside will outweigh the tax benefits offered
by an SEZ, according to experts. The Budget for 2011-12 has proposed to levy 18.5% MAT on
the book profits of units operating in SEZs.
Exporters in the domestic tariff area, or places outside the SEZs, are offered several incentives
under the foreign trade policy, such as the freedom to set up the unit anywhere and no obligation
to be net foreign exchange earners.
“SEZ units have been enjoying the advantage of zero-tax liability for five straight years and were
thus prepared to give up benefits of export promotion schemes, which vary between 3% and 5%
of the export value,” said Ajay Sahai, director general, Federation of Indian Export
Organisations. Once the tax-free status goes, equations change completely, he added.
For instance, if there is a unit that earns 10% profit, then it would earn Rs 10 on a turnover of Rs
100. If the unit is outside an SEZ, it would have to pay a tax of 33.5% on profit, which would
amount to Rs 3.5. But it would also get a minimum 3% incentive that would amount to Rs 3. The
same unit in an SEZ will have to pay Rs 1.85 as tax under the new MAT dispensation and will
not gain any export incentive.
“Although exporters can take credit for minimum alternate tax, SEZ units exporting 100% of
their production cannot adjust it in the first five years of operation as they would have no tax
liability to set it off against,” said SEZ consultant Hitender Mehta. Under the SEZ Act, units get
100% tax exemption on profits earned for the first five years, a 50% exemption for the next five
years and another 50% exemption on re-invested profits in the following five years.
With India signing free-trade agreements with several countries allowing imports on
concessional duties, there is an additional disadvantage for SEZ units. “While those operating
outside SEZs can import inputs at concessional rates, units in SEZs have to pay full customs
duties,” said R K Sonthalia, former president of export promotion council for EoUs and SEZs
and owner of a SEZ unit in Kolkata.

Mumbai Real Estate Continues to Remain Stagnant Amidst

High Property Prices

The real estate market in Mumbai continues to remain stagnant as sale transactions are at an all-
time low due to the high property prices. Traditionally, property sales in the city go up between
February and April, with March recording the highest number of transactions. But, this year even
that does not seem to be happening.
As per a research conducted by Prabhudas Lilladher, a financial services provider, home
registrations in February have come down to 4,716 from 5,735 in the same month last year.
“People are waiting for prices to come down and hence are deferring purchase,” said Kejal
Mehta, an analyst with Prabhudas Lilladher. On Gudi Padwa, the Hindu New Year, property
sales usually peak as it is regarded the most auspicious period to buy property. Analysts,
however, discount any such possibility this year.
“The prices are so high that people cannot afford to buy even if they want to,” said Pankaj
Kapoor, CEO, Liases Foras, a real estate research firm. Builders, however, continue to put a
brave front. “Prices have risen, but so have the salaries,” said Sunil Mantri, chairman,
Maharashtra Chambers of Housing Industry (MCHI). But, Mantri is quick to add that some
correction may be expected in a few areas in the city.
To add to the woes, even banks have tightened lending norms making home loans difficult and
costlier to procure. “Loans are a big problem,” said Mantri. Even the civic body is not clearing
any proposals with more than 150 such applications being rejected in recent times. “Builders
have a mindset not to reduce the prices till they are pushed to the corner,” said Pranab Datta,
vice-chairman and managing director, Knight Frank India Limited.

PM Supports Lower Stamp Duties to Ensure Transparancy

in Real Estate

Terming stamp duties as a “big obstacle” in ensuring transparent transactions in real estate,
Prime Minister Manmohan Singh on Friday batted for reducing such levies to check the flow of
black money in the sector. “I think as far as black money in real estate is concerned,
unfortunately that is a reality and one way out of this would be to lower the stamp duties,” Singh
said at the India Today Conclave here.
Replying to a poser on black money transactions in the real estate sector, the Prime Minister said
stamp duties in the country are a “big obstacle to cleaning the mess with regard to transactions in
real estate. “So that’s one way in which we can work towards a system whereby black money
would be less of a menace in transactions relating to real estate.”
HDFC Launches Online Property Search Portal

The entry of HDFC Ltd has stirred the online property search business segment. The country’s
top mortgage lender has launched its own real estate search portal www.hdfcred.com. The
venture will be operated under its wholly-owned subsidiary HDFC Developers Ltd.
“Our portal is a logical extension of our real estate business. Some of the grouses we came across
during our research is that the typical home buyer was not able to get all the details to facilitate
their property search process. While there is a lot of information lying around across various
mediums it is largely scattered. What we have attempted to do with our portal is bring all of it
under one platform in a detailed structured manner,” Renu Sud Karnad, managing director,
HDFC Ltd, said.

The features offered by the portal include searching for properties in key Indian cities at the click
of a button, use of filters to narrow down search, add properties to favourites, compare them, and
even find out useful information regarding social infrastructure and facilities available in the
neighbourhood.
India’s online property search market is currently estimated to be around Rs 60 crore. It includes
general real estate websites like www.99acres.com, www.magicbricks.com, and classifieds
portals like www.sulekha.com. The overall market has been growing at 50 per cent.
Ambuja Realty Group:
Bengal Ambuja Housing Development is a joint venture between Ambuja Housing and Urban Infrastructure
Company Limited and West Bengal Housing Board. Ambuja has taken the Real Estate Development through
the companies like AHUICL,ARDL,AAHUIL,BAMDL and many others. The company aims at homes at an
affordable price built on strong base and which brings you close to Nature.

DLF Building :
This is a booming real estate company of India. The biggest real estate company of India is launching their
most talked about project at the hottest location like Delhi. The company will make dream homes for the
Delhilites at a low price. The company is one among the key determinants for real estate companies. The
company is a trend setter in the industry of real estate. The company has developed 42 million square feet
of quality retail space in urban locations and metros in India.

Sun City Projects :

This is among the leading real estate companies in India. It has executed a a profusion in the sector of
urban real estate projects varying from Group Housing to Townships to luxury apartments,shopping malls
and complexes for office and amusement parks. For any query related to real estate the company can be
contacted in New Delhi.

Merlin Groups :
The company is a major real estate
Popular Categories
company in India for the past three
decades. The company has attributed
Townships and office buildings in Kolkata,
Ahmedabad, shopping malls,Hospitality ,Clubs etc in other destinations. It has also in its credit many
prestigious Commercial and residential complexes.

Magicbricks :
The key leader in the real estate sector is this property site. It is also the number one property site of India.
All the solutions related to real estate is at awaiting the click of a mouse. Just click any of the cities say
Pune, Kolkata, Ranchi,Bangalore etc. You can also avail the property rates of various destinations like
Kolkata, Chennai etc from this real estate site.

Ghar4u :
It is one among the top real estate companies in India. This Indian real estate company is a complete guide
for anything related to real estate. The company has organized process in the field of Real Estate Marketing.
The brochures provided by the company helps to make right choice for buying a home. The company
provides tips for selling a house or renting a house.The company has a wide network in
Jaipur,Visakhapatnam and Hyderabad.

NK Realtors:
A significant name in the Real Estate industry is NK Realtors. Rich portfolios of real estate projects are in the
kitty of the company. The company has delivered excellent quality work in the real estate sector. The
company has its base in Kolkata. The company offers services like flats,bungalows,commercial,retail,Ware
house etc.

99acres.com :
This property site provides all the updated information about the real estate matters like Property
Alerts,Property Dealers,Property Buyers etc. It is a one stop destination for real estate in Ahmedabad,
Nagpur,Coimbatore etc. One can choose from a variety of options for residential apartments from various
cities.

Mittal Builders:
This company is engaged in real estate business for the last five decades. Property development activity is
the agenda of the company. It has made significant achievements in the cities like Bangalore, Pune,
Secunderabad ,Nagpur and many others.The company's remarkable residential projects are Mittal
Park,Darya Mahal etc in the areas like Juhu Beach,Marine Drive etc.

K Raheja Constructions :
This real estate company plays a major role in the real estate development business. The company was
awarded one among the top ten Construction company-'Best Construction & Real Estate Sector
Implementation'.The company has in its credit real reality business,retailing outfits,hospitality sector. The
company has its offices in Mumbai, Pune, Chennai,Bangalore etc.