Complete Legal Checklist for NRIs Buying Property in India 2025 | Ghar

Non-Resident Indians (NRIs), defined under FEMA as Indian citizens residing outside India for over 182 days per year, can purchase residential or commercial properties in India, subject to specific regulations. Agricultural land, plantations, or farmhouses can only be acquired through inheritance or gift, not direct purchase. Buying property as an NRI requires careful legal due diligence to ensure compliance with the Foreign Exchange Management Act (FEMA), Reserve Bank of India (RBI) guidelines, and state-specific laws. This checklist provides a detailed guide for NRIs buying property in India in 2025, covering essential documents, verification steps, and practical tips to avoid disputes or financial complications. For those considering investment opportunities, exploring best cities to buy property in India can provide valuable insights into top locations and ROI potential.

Why a Legal Checklist is Crucial for NRIs

• Regulatory Compliance: Ensures adherence to FEMA, RBI, and local laws, avoiding penalties or repatriation issues.
• Clear Title: Verifies the seller's ownership, preventing disputes or fraud.
• Financial Clarity: Confirms no encumbrances (e.g., loans, liens) and proper tax compliance.
• Smooth Transactions: Facilitates loan approvals, property registration, and future sales.
• Research Suggests: Due diligence mitigates risks of fraudulent deals, especially when investing in smart cities across India.

Legal Checklist for NRIs Buying Property in India

Below is a comprehensive checklist of legal documents and steps for NRIs to verify before purchasing property in India, ensuring compliance and security.

1. Verify Eligibility and Property Type

Eligibility:

• NRIs can buy residential (flats, houses) or commercial properties (offices, shops).
• Agricultural land, plantations, or farmhouses are restricted unless inherited or gifted.
• Persons of Indian Origin (PIOs) or Overseas Citizens of India (OCIs) have similar rights under FEMA.

Verification:

• Confirm your NRI status (residing outside India for >182 days/year).
• Check property type with a lawyer to ensure it's permissible under FEMA.
• The Evidence Leans Toward: Restrictions on agricultural land prevent speculative purchases, particularly in states with emerging markets like those featured in emerging tier-3 city markets.

2. Title Deed (Sale Deed/Conveyance Deed)

Purpose:

Proves the seller's legal ownership and details the property's transfer history.

Details to Check:

• Seller's name matches the current owner.
• Property description (location, area, flat/plot number) aligns with the purchase.
• Registration details (date, sub-registrar's office).
• Stamp duty payment confirmation.

Verification:

• Obtain a certified copy from the sub-registrar's office or state portal (e.g., igrmaharashtra.gov.in for Mumbai properties).
• Engage a lawyer to conduct a 30-year title search for clear chain of title.
• Check for annotations indicating disputes or encumbrances.
• Research Suggests: A clear title is critical to avoid ownership disputes, particularly when investing in major metros like Bangalore or Pune.

3. Encumbrance Certificate (EC)

Purpose:

Confirms the property is free from legal or financial liabilities (e.g., mortgages, liens, litigation) for a specified period (13–30 years).

Details to Check:

• Property details (survey number, address, flat number).
• No encumbrances or clear resolution of listed liabilities.
• Covers at least 30 years for comprehensive due diligence.

Verification:

• Obtain from the sub-registrar's office or online via state portals (e.g., tnreginet.gov.in for Chennai properties).
• Cross-check with title deed and land records.
• It Seems Likely That: An EC is mandatory for loan approvals and registration, especially in investment hotspots like Hyderabad.

4. Property Tax Receipts

Purpose:

Ensures property taxes are paid, preventing municipal liens or penalties.

Details to Check:

• Seller's name and property details match.
• Receipts cover the last 3–5 years or up to FY 2024–25/2025–26.
• No outstanding dues or penalties.

Verification:

• Request copies from the seller.
• Check online via municipal portals (e.g., mcgm.gov.in for Mumbai, bbmptax.karnataka.gov.in for Bangalore).
• Obtain a No Dues Certificate from the municipal corporation.
• The Evidence Leans Toward: Unpaid taxes can block registration, particularly important when buying in cities like Kolkata or Ahmedabad.

5. No Objection Certificate (NOC) from Housing Society

Purpose:

Confirms no objections to the sale, no pending society dues, and compliance with bylaws (for flats).

Details to Check:

• Issued on society letterhead, signed by the secretary/chairman.
• No outstanding maintenance, water, or other dues.
• Matches flat and seller details.

Verification:

• Request the original NOC from the seller.
• Verify with society office records.
• For NRIs, ensure the society allows NRI ownership (some have restrictions).
• Research Suggests: An NOC is essential for flats in cooperative societies, especially in metros like Navi Mumbai or Thane.

6. Share Certificate (for Flats)

Purpose:

Proves the seller's membership in the housing society and ownership of shares linked to the flat.

Details to Check:

• Seller's name as shareholder.
• Flat number and society details.
• No annotations indicating disputes or transfers.

Verification:

• Request a copy from the seller.
• Confirm with the society's registrar.
• It Seems Likely That: Share certificates are critical for cooperative society flats, particularly important in cities like Nagpur and Nashik.

7. Occupancy Certificate (OC)

Purpose:

Certifies the building is constructed per approved plans and is safe for occupancy.

Details to Check:

• Building name, address, and developer details.
• Date of issuance and compliance with regulations.
• Covers the flat's floor or entire building.

Verification:

• Obtain from the seller or builder.
• Check with the municipal corporation (e.g., BMC, BBMP) or RERA portal (maharera.maharashtra.gov.in).
• The Evidence Leans Toward: Lack of OC can lead to utility or legal issues, especially important when considering RERA compliance in Gujarat.

8. Completion Certificate (CC)

Purpose:

Confirms the building construction is complete and complies with approved plans.

Details to Check:

• Matches building and flat details.
• Issued before or with the OC.
• No pending violations.

Verification:

• Obtain from the seller or builder.
• Verify with municipal corporation or RERA portal.
• Research Suggests: CC is a prerequisite for OC, particularly crucial when investing in emerging markets like Surat or Rajkot.

9. Approved Building Plan

Purpose:

Ensures the flat/building adheres to sanctioned plans, avoiding unauthorized constructions.

Details to Check:

• Flat layout, dimensions, and location match the plan.
• Sanctioned by the municipal corporation/development authority.
• No deviations or violations.

Verification:

• Obtain from the seller or society.
• Check with municipal records or RERA portal.
• It Seems Likely That: Unauthorized constructions risk demolition, especially relevant when considering properties in Vadodara or Jaipur.

10. Land Records (for Independent Houses/Plots)

Purpose:

Verifies the land's title and use (e.g., non-agricultural for residential).

Details to Check:

• Owner's name, survey number, and land area in records (e.g., 7/12 extract, RTC).
• No encumbrances or disputes.
• Non-agricultural conversion (e.g., 8A extract in Maharashtra).

Verification:

• Check online via state portals:
• Maharashtra: bhulekh.mahabhumi.gov.in (7/12, Property Card).
• Karnataka: bhoomi.karnataka.gov.in (RTC, Khata).
• Gujarat: anyror.org.in (7/12).
• Visit revenue offices for physical copies.
• The Evidence Leans Toward: Land records ensure title clarity, particularly important when investing in growing cities like Gurgaon or Noida.

11. RERA Compliance Documents

Purpose:

Ensures the project is registered under the Real Estate (Regulation and Development) Act, 2016, protecting NRI buyers.

Details to Check:

• RERA registration number.
• Developer details, project status, and approved plans.
• No pending complaints or violations.

Verification:

• Check on state RERA portals (e.g., maharera.maharashtra.gov.in).
• Search by project name, developer, or RERA number.
• Research Suggests: RERA compliance is mandatory for post-2016 projects, essential when considering properties in Indore or Coimbatore.

12. Home Loan Clearance Documents (if applicable)

Purpose:

Confirms any existing loan on the property is repaid, ensuring no bank claims.

Details to Check:

• Loan closure letter/No Dues Certificate from the bank.
• Mortgage release documents from the sub-registrar.

Verification:

• Request from the seller.
• Verify with the bank and check EC for mortgage clearance.
• It Seems Likely That: Pending loans block transfers, particularly crucial when buying in high-value markets like North Goa or luxury villa locations in Goa.

13. Power of Attorney (POA) (if applicable)

Purpose:

Allows a representative to act on behalf of the seller or NRI buyer.

Details to Check:

• Registered and notarized POA.
• Specifies scope (e.g., sale, purchase).
• Matches seller/buyer details.

Verification:

• Obtain a registered copy.
• Verify with sub-registrar or notary records.
• For NRIs, ensure the POA is attested by the Indian Embassy abroad if executed overseas.
• The Evidence Leans Toward: Unregistered POAs risk fraud, especially important when dealing with properties in secondary cities like Aurangabad or Dehradun.

14. No Dues Certificate from Utility Providers

Purpose:

Confirms no pending dues for electricity, water, or gas.

Details to Check:

• Issued by providers (e.g., BEST in Mumbai, BESCOM in Bangalore).
• Covers the property and seller's name.
• Valid up to the current date.

Verification:

• Request from the seller.
• Check with utility providers or online portals (e.g., bescom.karnataka.gov.in).
• Research Suggests: Utility dues affect transfers, crucial when considering properties in growing markets like investment areas in Jaipur.

Additional FEMA and RBI Compliance

Payment Rules:

• Funds must come from an NRE/NRO/FCNR account or inward remittance via banking channels.
• Payments cannot be made in cash or foreign currency directly.

Repatriation:

• NRIs can repatriate sale proceeds (up to USD 1 million per financial year) after paying taxes, subject to RBI rules.
• Provide Form 15CA/CB (CA certificate) for repatriation.

Tax Implications:

• TDS: Seller deducts 20% (long-term capital gains) or 30% (short-term) for NRIs, deposited with the Income Tax Department.
• Stamp Duty: Payable by the buyer (5–7% of property value, varies by state).
• Obtain a Tax Clearance Certificate if required.

Verification:

• Consult a chartered accountant for FEMA compliance and tax filings.
• Check RBI guidelines on rbi.org.in.
• It Seems Likely That: FEMA compliance is critical for NRIs, especially when investing in second homes across India.

Step-by-Step Verification Process

1. Engage a Property Lawyer: Hire a lawyer in India to review documents, verify title, and ensure FEMA compliance. Critical for NRIs due to distance and legal complexities.
2. Request Documents from Seller: Obtain originals or certified copies of title deed, EC, tax receipts, NOC, etc. Ensure documents are up-to-date and cover the property's history.
3. Conduct Title Search: Perform a 30-year title search via a lawyer or sub-registrar's office to confirm clear ownership. Use EC and land records (e.g., 7/12, RTC) for verification.
4. Verify with Authorities: Check title deed and EC on state portals (e.g., igrmaharashtra.gov.in). Confirm tax and utility dues on municipal/utility portals. Validate RERA compliance on maharera.maharashtra.gov.in.
5. Physical Inspection: Appoint a trusted representative or visit the property to confirm its condition, layout, and compliance with plans. Meet society officials for flats to verify NOC and share certificate.
6. Check for Litigation: Search court records (ecourts.gov.in) or consult a lawyer to ensure no pending cases. Verify no disputes via EC and RERA portal.
7. Draft Sale Agreement: Include verified documents, FEMA compliance, and payment terms. Register the agreement at the sub-registrar's office.
8. Complete Payment: Use NRE/NRO/FCNR accounts or inward remittance. Obtain TDS certificate from the seller and file with the Income Tax Department.
9. Register the Property: Pay stamp duty (e.g., 5–7% in Maharashtra) and registration fees (1%). Submit documents to the sub-registrar for registration. Use state portals for e-registration if available (e.g., igrmaharashtra.gov.in).
10. Apply for Mutation: Update ownership in land records (e.g., 7/12, RTC, Property Card) via state portals like bhulekh.mahabhumi.gov.in. Submit sale deed, EC, and identity proofs; pay nominal fees (Rs. 25–1,000). Process takes 15–60 days.

Practical Tips for NRIs (2025)

• Hire Local Experts: Engage a lawyer and chartered accountant in India for legal and tax compliance.
• Use Digital Tools: Leverage state portals (Mahabhulekh, Bhoomi) and RERA for document verification.
• Appoint a POA: If abroad, appoint a trusted representative via a registered POA, attested by the Indian Embassy.
• Check RERA: Ensure the project is RERA-registered for transparency and protection.
• Budget for Costs: Account for stamp duty (5–7%), registration fees (1%), TDS (20–30%), and legal fees.
• Avoid Cash: Use banking channels to comply with FEMA and avoid penalties.
• Monitor Updates: In 2025, digital tools or revised FEMA rules may emerge. Check rbi.org.in or dilrmp.gov.in.
• Verify Developer: For new projects, research the developer's track record on RERA portals.
• The Evidence Leans Toward: Digitalization simplifies verification for NRIs, particularly beneficial when exploring rental investment opportunities in Indore.

Example Scenario

Suppose an NRI in the US wants to buy a flat in Bangalore:

1. Step 1: Confirm eligibility (residential flat, permissible under FEMA).
2. Step 2: Lawyer verifies title deed, EC (30 years), and RERA registration on karnatakaregistration.gov.in.
3. Step 3: Check property tax on bbmptax.karnataka.gov.in and obtain society NOC.
4. Step 4: Use NRE account to pay via bank transfer; seller deducts 20% TDS.
5. Step 5: Register sale deed at sub-registrar's office, paying 5% stamp duty.
6. Step 6: Apply for mutation on bhoomi.karnataka.gov.in, updating RTC and Khata.
7. Outcome: The NRI owns the flat legally, with updated records and FEMA compliance.

Considerations for 2025

• Digitalization: DILRMP has digitized land records in over 20 states, with portals like Mahabhulekh offering real-time updates.
• FEMA Updates: Monitor RBI guidelines for changes in repatriation or payment rules.
• State Variations: Document names differ (e.g., Khata in Karnataka cities like Mysore, Patta in Tamil Nadu). Check state portals.
• RERA Enforcement: Stricter compliance ensures transparency for NRI buyers, particularly beneficial when exploring commercial real estate opportunities in Chandigarh.
• Potential Updates: New digital tools or tax revisions may emerge in 2025. Check mcgm.gov.in or housing.gov.in.

Frequently Asked Questions

Can NRIs buy agricultural land in India?
No, NRIs cannot directly purchase agricultural land, plantations, or farmhouses in India. These can only be acquired through inheritance or gift under FEMA regulations.

What is the maximum amount an NRI can repatriate from property sale proceeds?
NRIs can repatriate up to USD 1 million per financial year from property sale proceeds after paying applicable taxes, subject to RBI guidelines.

Is RERA registration mandatory for all property purchases?
RERA registration is mandatory for all real estate projects launched after May 2016. For older projects, check state-specific RERA portals for compliance status.

Can NRIs take home loans for property purchase in India?
Yes, NRIs can avail home loans from Indian banks and NBFCs. However, loan eligibility and terms may differ from resident Indians, and proper documentation is essential.

What happens if property taxes are pending at the time of purchase?
Pending property taxes can block registration and transfer of ownership. Always obtain a No Dues Certificate from the municipal corporation before proceeding with the purchase.

Is Power of Attorney mandatory for NRIs buying property?
While not mandatory, a registered Power of Attorney is highly recommended for NRIs who cannot be physically present during the transaction. Ensure it's attested by the Indian Embassy if executed abroad.

How long does the property registration process take?
The registration process typically takes 1-7 days, depending on the state and document verification. Mutation in land records can take an additional 15-60 days.

Can NRIs buy property in joint names with resident Indians?
Yes, NRIs can buy property jointly with resident Indians. However, specific documentation and compliance requirements under FEMA must be met.

Conclusion

NRIs buying property in India must follow a rigorous legal checklist to ensure compliance with FEMA, RBI, and local laws. Verifying title deeds, EC, RERA compliance, and land records, while using digital portals like Mahabhulekh or RERA, ensures a secure transaction. Engaging local experts, using banking channels, and acting promptly mitigate risks. In 2025, digital tools and RERA enforcement simplify the process, but thorough due diligence remains essential for NRIs to safeguard their investment.

Whether you're considering properties in major metros like Mumbai, Bangalore, or exploring emerging markets in tier-2 cities like Gorakhpur, following this comprehensive checklist will help ensure a smooth and legally compliant property purchase experience for NRIs.