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1.
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What is FSI?
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2.
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Is the leave and licence agreement generally signed in multiples of 11 months or 12 months? Is there any stipulation of time?
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3.
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Can premises already encumbered to a bank be leased out to a Company with a high deposit and in case of a default who holds the first lien? And will the Company/Occupant be evicted?
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4.
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Is Business Centre Agreement done for Commercial Premises safe?
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5.
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What is TDR?
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6.
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Is registration of a Leave and Licence mandatory and what are the consequences if the same is not registered?
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7.
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How do I determine the property tax on the rent received as I have given the premises on higher rent to a Company? Are there any guidelines set by the BMC?
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8.
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Society charges us heavy amounts and even deposits if we give our apartment on Leave and Licence basis without payment of past dues which are in litigation? Would occupation by the occupant create more trouble for him and me?
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9.
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The society refuses to give us NOC for leasing the apartment on leave and licence basis without payment of past dues which are in litigation? Would occupation by the occupant create more trouble for him and me?
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10.
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What is the difference between lease and leave and licence agreement?
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11.
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Do I need permission of the Society to keep a Paying Guest and are there any extra society outgoings I need to bear?
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12.
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Is it compulsory to Register Sale Agreements/ Documents of ownership flats:
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13.
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I have a flat which I want to sell and buy a new flat which will be bigger in area. What are my tax implications especially with regard to capital gains?
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14.
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When a flat is gifted to a daughter what are the legal implications regarding:
i) Title- and how is this established.
ii) Gift tax- is it leviable and if so when?
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15.
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How to appeal for reduction of property tax if you are an individual in a society?
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16.
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I have a flat which I want to sell and buy a new flat which will be bigger in area. What are my tax implications especially with regard to capital gains?
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17.
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Is it safe to give ownership flat for leave and licence? What are the problems if I give for a longer period?
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18.
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Some residential and commercial properties which I own are occupied by people who are not paying rent and also not vacating. I require help in solving such problems.
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19.
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House on rent for 35 years. Rent receipt is in the name of the mother. If the mother is to pass away, will the daughter be asked to continue staying in the house? The landlord is threatening to vacate them after the mother passes away, what can they do to protect themselves? Will they have a good case in Court? The daughter already has a flat in her name. Will it make a difference?
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20.
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If the landlord does not repair or maintain property, staircase, terrace and the tenants want to do, can they and can they deduct rent from the landlord if he does not share.
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21.
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Do we require permission from the landlord for taking separate water connection, tank etc.
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22.
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How can we evict tenants who do not pay or have made changes in their flats?
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23.
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Some people have constructed in our Society, a Jain temple without the permission of AGM.. Then what are we to do?
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24.
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Our building is going to be broken and reconstructed and the owner promises housing for 15 months during which time he will finish construction. In the event that he cannot, what do we do?
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25.
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I have a property in MHADA which I want to develop into a Hospital….What is the process? Does it amount to change of user?
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26.
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What are the formalities required to be completed by foreign citizens of Indian origin for purchasing residential immovable property in India under the general permission?
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27.
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Can such property be sold without the permission of Reserve Bank?
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28.
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Can sale proceeds of such property if and when sold be remitted out of India?
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29.
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Are any conditions required to be fulfilled if repatriation of sale proceeds is desired?
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30.
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What is the procedure for seeking such repatriation?
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31.
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Can foreign citizens of Indian origin acquire or dispose of residential property by way of gift?
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32.
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Can immovable property held in India, be transferred by way of gift to relatives/registered charitable trusts/organisations in India?
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33.
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Can foreign citizens of Indian origin acquire commercial properties in India?
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34.
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Can they dispose of such properties?
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35.
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Can sale proceeds of such property be remitted out of India?
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36.
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Can the properties (residential/commercial) be given on rent if not required for immediate use?
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37.
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Can NRIs obtain loans for acquisition of a house/flat for residential purpose from authorised dealers/financial institutions providing housing finance?
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38.
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Can Indian companies grant loans to their NRI staff?
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39.
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Can authorised dealer grant housing loan to non-residents of Indian nationality where he is a principal borrower with his resident close relative as a co-obligant/guarantor or where the land is owned jointly by such NRI borrower with his resident close relative?
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1.
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Floor Space Index(FSI) means the quotient of the ratio of the combined gross floor area of all floors excepting areas specifically exempted under these Regulations to the total area of the plot.
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2.
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Formerly leave and licence agreements used to be signed in multiples of 11 months or 12 months. After The Maharashtra Rent Control Act,1999 came into force from 1.3.2000 there is no stipulation as to whether leave and licence agreement should be in multiples of 11 or 12 months, and there is no stipulation as to total time period.However Leave and licence agreement generally does not exceed three years.
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3.
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Yes premises already encumbered to a bank can be leased out to a Company with a high deposit. However you may require the No-Objection of the bank. If the deposit monies are with you and in case if you default on payment to the bank,obviously you will continue to hold the deposit money. The Co./occupant can be evicted only if there is a provision to that effect in the lease Agreement.
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4.
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If the Business Centre Agreement is genuinely a Business Centre Agreement then it is safe to use commercial premises as such business center, since you shall be in physical control of the premises
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5.
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Rule 34 of the Development Control Regulations for Greater Bombay,1991 defines TDR which stands for Transferable Development Rights as under:
‘In certain circumstances, the development potential of a plot of land may be separated from the land itself and may be made available to the owner of the land in the form of Transferable Development Rights. These rights may be made available and be subject to the Regulations in Appendix VII hereto.
Appendix VII lays down the rules for the grant of Transferable Development Rights to owners/developers and conditions for grant of such rights:
1. The owner (or lessee) of a plot of land which is reserved for a public purpose in the development plan and for additional amenities deemed to be reservations provided in accordance with these Regulations excepting under certain conditions shall be eligible for the award of TDR in the form of Floor Space Index(FSI) to the extent and on the following conditions set out below. Such award will entitle the owner of the land to FSI in the form of a Development Rights Certificate (DRC) which he may use himself or transfer to any other person.
2. Subject to Reg.1 where a plot of land is reserved for any purpose specified in S.22 of Maharashtra Regional and Town Planning Act,1966 the owner would be eligible for DR’s to the extent stipulated in Rules 5 & 6 in this Appendix after the said land is surrendered free of cost or after completion of development.
3.TDR’s will be available only for prospective development of reservations.
4.DRC’s will be issued by the Commissioner himself giving details of FSI credit.
5.The built up area for the purpose of FSI shall be equal to the gross area of the reserved plot to be surrendered.
6.When the owner or lessee also develops or constructs the amenity on the surrendered plot at his cost, he may be granted a further DR in the form of FSI equal to the area of the construction/ development done by him.
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6.
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As per Section 55 of the Maharashtra Rent Control Act,1999 registration of Leave and Licence Agreement is compulsory and it is the responsibility of the landlord to ensure registration. If the same is not registered, the landlord would be prosecuted and on conviction he’s subject to upto three months imprisonment or be subject to fine not exceeding Rs.5000/- or with both. Further in the absence of a Registered Agreement, the contention of the tenant, about the terms and conditions on which the premises have been given to him by the landlord shall prevail unless otherwise proved.
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7.
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The calculation of property tax on rent cannot be generalized and depends on various factors, but however if the premises are rented out to banks, companies, multi-nationals, etc. who are exempted from the provisions of the Maharashtra Rent Control Act,1999 by virtue of Section 3(1) (B) of the Act then the rates of property taxes could be as high as 60% or so. If the premises are rented out to others, who are protected under the Rent Act, the Mumbai Municipal Corporation cannot charge taxes on the actual rent and have to base their taxes on Standard rent defined under the Act, which is, in most cases lower than the actual market rent.
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8.
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Although there are no fixed rules on the subject. However the society must be reasonable in all matters and if it is charging an exorbitant amount you could approach the Registrar of Co-operative Societies.
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9.
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If the society is not giving you its No-objection and you still give your flat out on leave and licence, the society could file a suit against you and the licencee and take legal action.
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10.
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Lease is defined under Section 105 of The Transfer of Property Act,1882 and a lease of immoveable property is a transfer of a right to enjoy such property for a certain time or in perpetuity on consideration to be rendered periodically or on specified occasions, while a licence is defined in Section 52 of the Indian Easement Act,1882 and it does not create any interest in the premises in favour of the licensee excepting a mere right to use and occupy the premises for a limited duration. Both documents have now to be registered. A lease deed is required to be stamped and registered. However the stamp duty payable on lease is more than on Leave and Licence for a period upto three years. For a period exceeding three years the stamp duty is same for both agreements.
The implications of entering into a lease agreement would be:
i) That stamp duty would have to be paid
ii) That the document would have to be registered
iii) That Municipal taxes may go up
iv) Of course, Income-tax would have to be paid on your income; and
v) The question of Wealth-tax would have to be considered. One property is exempt from Wealth-tax. However, if you have any other property, this implication would have to be considered.
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11.
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Yes, you need permission of the Society for keeping a Paying Guest. It depends on the Society bye-laws and rules. Some Societies keep asking for extra outgoings by way of Non-Occupancy charges.
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12.
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a) Purchase from builders
b) Resale flats -Society not registered
c) Resale in a Registered Co-op Society (Conveyance in favour of Society completed)
d) Resale in a Registered Co-op Society (Conveyance not completed through administration by Society.)
Answer
(i) Registration of agreement for sale/documents of ownership flats when ownership flats are purchased from builders, one should register such agreements with the Sub-Registrar.
(ii) In case of resale of flats in a society which is not registered, the registration would be required.
(iii) In case of resale of flats in a registered Co-operative Society no registration is compulsory as per section 41 of the Maharashtra Co-operative Societies Act, 1960. However, some societies do insist that such documents be registered.
(iv) It does not really matter whether conveyance has been granted to the society or not since it is only a change of membership which takes place in a society. Thus the answer to (c) above is relevant even where no conveyance has been granted in favour of a society.
(v) The Registrar of Co-operative Societies has issued some time back a circular to societies whereby he has stated that all documents for transfer of flats be registered. However, under section 41 of the Maharashtra Co-operative Societies Act registration is not compulsory in case of sale of flats in societies but in view of the aforesaid circular some societies do insist on registration.
(vi) The Bombay High Court has held that transfer of shares in a co-operative society is in fact transfer of immovable property for the purpose of stamp duty. However, section 41 of the Maharashtra Co-operative Societies Act is still valid and two issues involved here are different. Section 41 deals specifically with regard to the registration issue as stated above.
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13.
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On the proposed sale of your flat you may purchase another flat within two years of the date of sale of the original flat. If you have invested the entire amount of capital gain irrespective of your area of the flat, you would not have to pay any capital gains tax.
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14.
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If one has gifted a flat to his daughter one should have the gift deed drawn out which should be witnessed by two persons. In case of both the donor and the donee it is preferable to register the said gift deed even if the flat is in a co-operative society. Stamp duty would have to be paid on the gift deed which would be the same as in case of the sale of a flat. However, there is no gift tax applicable. The gift deed would be the title document indicating the gift to the daughter along with the share certificate if it is in a co-operative society.
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15.
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If property tax has been levied which you feel ought to be reduced, you should write to the society stating your reasons for the same. The society would take up the matter with the Municipal Authorities and have the same reduced if the same is justified.
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16.
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On the proposed sale of your flat you may purchase another flat within two years of the date of sale of the original flat. If you have invested the entire amount of capital gain irrespective of your area of the flat, you would not have to pay any capital gains tax.
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17.
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Yes, it is safe to give ownership flat for leave and licence provided an agreement has been entered into to that effect and the same leave and licence agreement has been registered with the Competent Authority under the Maharashtra Rent Control Act,1999.
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18.
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In those residential and commercial properties owned by you and occupied by people who are not paying rent you may serve a notice in writing to the tenants for demand of the standard rent in the manner provided in Section 106 of the Transfer of Property Act,1882(IV of 1882) and after expiry of 90 days and the rent has yet not been submitted by the tenants you may then file a suit for eviction of the tenants under the Maharashtra Rent Control Act,1999 and recover possession of the tenanted premises under Section 16 of the said Act.
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19.
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After the death of your mother, the landlord would be required to transfer the rent receipt to the family members staying with her at the time of her death. So if your sister is staying with your mother at the time of her death, she can have the rent receipt transferred in her name. However if your sister has another flat in her name the landlord would have a good case for eviction against your sister if he requires the said flat for his own personal use.
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20.
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If the landlord does not repair or maintain the property, the tenant could after giving sufficient notice to the landlord do so carry out repairs which are necessary and deduct the cost thereof from the rent.
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21.
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Yes, you do require permission from the landlord for taking separate water connection, tank etc.
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22.
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You can evict the tenant who is not paying rent or who has made permanent alterations/additions in the premises by giving him notices to this effect as required under law and proceed against the tenant in a Court to evict him.
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23.
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If any unauthorised construction has taken place at any place you could approach the local authority i.e. the municipal corporation in the relevant case who would then take proper action in the matter.
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24.
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If any unauthorised construction has taken place at any place you could approach the local authority i.e. the municipal corporation in the relevant case who would then take proper action in the matter.
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25.
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Whether you can convert your property into a hospital would depend on the terms and conditions of the lease or allotment from MHADA. Normally, conversion of a residential property into a hospital would be possible as this is an essential service. However the approval of MHADA would be required and so would that of the BMC. This would amount to change of user because it is for a hospital. This could be permitted.
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26.
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They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration alongwith a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.
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27.
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Yes. Reserve Bank has granted general permission for sale of such property. However, where the property is purchased by another foreign citizen of Indian origin, funds towards the purchase consideration should either be remitted to India or paid out of balances in NRE/FCNR accounts.
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28.
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In respect of residential properties purchased on or after 26th May 1993, Reserve Bank considers applications for repatriation of sale proceeds up to the consideration amount remitted in foreign exchange for the acquisition of the property for two such properties. The balance amount of sale proceeds if any or sale proceeds in respect of properties purchased prior to 26th May 1993, will have to be credited to the ordinary non-resident rupee account of the owner of the property.
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29.
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Applications for repatriation of sale proceeds are considered provided the sale takes place after three years from the date of final purchase deed or from the date of payment of final instalment of consideration amount, whichever is later.
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30.
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Applications for necessary permission for remittance of sale proceeds should be made in form IPI 8 to the Central Office of Reserve Bank at Mumbai within 90 days of the sale of the property.
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31.
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Yes. Reserve Bank has granted general permission to foreign citizens of Indian origin to acquire or dispose of properties up to two houses by way of gift from or to a relative who may be an Indian citizen or a person of Indian origin whether resident in India or not, subject to compliance with applicable tax laws.
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32.
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Yes. General permission has been granted by Reserve Bank to non-resident persons (foreign citizens) of Indian origin to transfer by way of gift immovable property held by them in India to relatives and charitable trusts/organisations subject to the condition that the provisions of any other law, including Foreign Contribution (Regulation) Act, 1976, as applicable, are duly complied with.
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33.
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Yes. Under the general permission granted by Reserve Bank properties other than agricultural land/farm house/plantation property can be acquired by foreign citizens of Indian origin provided the purchase consideration is met either out of inward remittances in foreign exchange through normal banking channels or out of funds from the purchasers' NRE/FCNR accounts maintained with banks in India and a declaration is submitted to the Central Office of Reserve Bank in form IPI 7 within a period of 90 days from the date of purchase of the property/final payment of purchase consideration.
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34.
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Yes.
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35.
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Yes. Repatriation of original investment in respect of properties purchased by foreign citizens of Indian origin on or after 26th May 1993 will be allowed to be remitted up to the consideration amount originally remitted from abroad provided the property is sold after a period of three years from the date of the final purchase deed or from the date of payment of final instalment of consideration amount, whichever is later. Applications for the purpose are required to be made to the Central Office of Reserve Bank within 90 days of the sale of property in form IPI 8.
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36.
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Yes. Reserve Bank has granted general permission for letting out any immovable property in India. The rental income or proceeds of any investment of such income are eligible for repatriation.
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37.
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Reserve Bank has granted general permission to certain financial institutions providing housing finance e.g. HDFC, LIC Housing Finance Ltd., etc., and authorised dealers to grant housing loans to non-resident Indian nationals for acquisition of a house/flat for self-occupation subject to certain conditions. The purpose of the loan, margin money and the quantum of loan will be at par with those applicable to housing loans to residents. Repayment of loan should be made within a period not exceeding 15 years out of inward remittances or out of funds held in the investors‘ NRE/FCNR/NRO accounts.
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38.
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Reserve Bank permits Indian firms/companies to grant housing loans to their employees deputed abroad and holding Indian passports subject to certain conditions.
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39.
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Yes. However, in such cases the payment of margin money and repayment of the loan instalments should be made by the NRI borrower.
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