Protection Plan for NRI’s Property

Property gained by inheritance, joint ownership with their relatives or an investment in property in India so as to remain in contact with the country of their origin, NRIs have ownership of property in India. 

 NRIs around the globe face a common problem related to the illegal possession of their property. To deal with such situations they either had to come to India personally and then get involved with various legal procedures or can appoint a representative who would handle his case on his behalf, such a representative could be an advocate or a relative of the NRI. 

Kinds of disputes related to property-

• Disputes often arise in the property owned by NRIs from their legal heirs or other joint owners of the property.
• Disputes out of easement rights.
• Any illegal possession by a third party.
• Encroachment on the property by false documents 
• By misuse of the power of attorney.
• Disputes due to the partition or family settlement
• Disputes between landlord and tenant where the landlord is the NRI
• If the caretaker or a third party occupies the property for a period of 12 years within the knowledge of the NRI, it leads to adverse possession. 

Steps to be taken- 

To sort out the issue various steps could be taken- 

• To file  a police complaint- a police complaint can be filed with the original documentation of the property to the nearest police station. The property can be gained back under Specific Relief Act (sec 5 & 6).
• Another method to solve the issue of illegal possession of the property is through negotiation. The NRI party and the party illegally possessing the property can sort out the matter through negotiating. This procedure could be followed by legal advice.
• Also, one can seek professional advice from an experienced advocate before taking any legal decision, so as to ensure which steps could be taken.

How to safeguard the Property so as to avoid the situation of illegal possession-

The NRIs living outside the country should ensure that their property is safe in India. To ensure that any legal dispute or any adverse possession of the real estate of NRIs does not take place, following steps could be taken- 

• NRI should keep all the original documents including the deed, copy of a will, original purchase documents of the property with him.
• The documents and other required papers should be regularly updated in the Government land records. Also, the receipts of taxes paid for the property such as Municipal Taxes, electricity bills or water supply bills etc. shall be kept by the NRI>
• A fence or boundary shall be made on the boundary of the vacant plot. To ensure that no illegal possession does not take place the NRI could put up a board indicating the ownership of the NRI.
• A notice implying the ownership of the NRI can also be published in local newspapers. The original copy of the notice in the newspaper shall be kept by the NRi for future purposes.
• Also several professional organisations offer protection of property on the behalf of the NRI for some commission, their services could also be availed by the NRI.
• The NRI shall remain in touch with the neighbours around his property so he/she can be informed of any changes in the circumstances around the property. 
• A caretaker can be hired by the NRI for his/her property, as even after a long possession, the property can’t be acquired by the caretaker.
• Before the property is rented out, a proper verification of the tenants shall be done, also a proper rent agreement shall be made before renting the property to a tenant.

Taxes- 

There is no restriction on owning the no. of properties by the NRI. Income Tax Act,1961 provides for certain tax deductions to NRIs who invest in the properties in India. Like the Citizens of India, deductions under Section 24 and Section 80C can be claimed by the NRIs.

Foreign Exchange Management Act, 1999 (FEMA)-

• FEMA is a set of rules which empowers the RBI to pass regulations and enables the Government of India to pass rules relating to the foriegn exchange in relation to the foreign trade policy of the country.
• It replaced the Foreign Exchange Regulation Act- FERA
• Features of FEMA

• It provides powers to the Government to regulate flow of payments to and from the person outside the country.
• Without the approval of FEMA no foreign exchange can take place.
• In interest of the general public Govt. can restrict an authorised person from carrying out any foriegn exchange from a current account.
• It empowers the RBI  to place restrictions on transactions from the capital account even if it is carried out by an authorised person.

Lead India provides you with the team of best civil lawyers for drafting and filing a civil suit for any unauthorised or illegal possession of the NRI property.