How Can an NRI Buy Property in Bangalore from Abroad?

Purchasing property in India while residing abroad can be a seamless process when executed correctly. Below are five simplified steps to guide NRIs through the process of buying property in Bangalore remotely:

1. General Power of Attorney (GPA)
2. Sale Agreement
3. Home Loan (if applicable)
4. Tax Deducted at Source (TDS) (if applicable)
5. Sale Deed

To illustrate the process, let’s consider the real-life example of Mrs. Priya, an NRI based in Denmark, who successfully purchased a 2BHK flat in Bangalore.

Case Study: Mrs. Priya’s Property Purchase in Bangalore

Mrs. Priya, residing in Denmark, decided to buy a 2BHK flat in Bangalore for Rs. 49,75,000. Due to her work commitments, she could not travel to India for the property registration. She, therefore, appointed her mother as her lawful Power of Attorney (PoA) holder in India.

Step 1: General Power of Attorney (GPA)

To authorize her mother to act on her behalf, Mrs. Priya followed these steps to create and adjudicate the GPA:

1. Drafted the GPA in a Word document.
2. Printed the GPA on A4-size paper.
3. Affixed her passport-size photograph on the last page.
4. Signed the GPA in the presence of a Notary Public in Denmark, along with two witnesses.
5. Obtained notary attestation and a notary certificate.
6. Self-attested a copy of her passport.
7. Sent the notarized GPA and passport copy to India via courier.
8. Her mother submitted the documents to the District Registrar’s Office (DRO) in India for adjudication, along with:
   • Original GPA
   • Self-attested passport copy of Mrs. Priya
   • Her mother’s Aadhaar card
   • A request letter for adjudication
9. The DRO verified and adjudicated the GPA. Refer to below image 

Step 2: Sale Agreement

The sale agreement is a critical document that establishes the terms and conditions of the transaction.

Steps followed:

1. Drafted the sale agreement in a Word document.
2. Printed the agreement on A4-size paper.
3. Both seller and GPA holder (mother) signed the agreement, with two witnesses signing the last page.
4. Generated a K2 challan of Rs. 4,975 (0.1% of the buying price) for adjudication. (Updated fee as of November 8, 2024: 0.5% of the buying price.)
5. Adjudicated the sale agreement at the K.R. Puram Sub-Registrar’s Office in Bangalore.

Below is the image of sale agreement:

Below is the image of K2 challan for Sale Agreement Adjduication

Below image of Sale Agreement adjudication

Step 3: Home Loan (if applicable)

Mrs. Priya applied for a home loan through HDFC Home Loan, Kasturba Road Branch, Bangalore.

The bank required the following documents:

• Income proof of Mrs. Priya
• Property documents, including the seller’s sale deed and Encumbrance Certificate (EC)
• Sale Agreement

Mrs. Priya exchanged the documents via email while her representative in India submitted the hard copies to the bank. The loan was sanctioned within 15 working days, and the amount was issued via cheque in the seller’s name.

Step 4: Tax Deducted at Source (TDS)

Since Mrs. Priya’s property value was Rs. 49,75,000, TDS was not applicable.

(Note: If the property value or its guidance value exceeds Rs. 50 lakh, TDS at 1% must be deducted and paid to the government. Guidance value refers to the minimum property value as determined by the Department of Stamps & Registration.)

Step 5: Sale Deed Registration

The sale deed is a legally binding document transferring ownership from seller to buyer. Below were the steps followed:

1. Drafted the sale deed in a Word document.
2. Applied online via Kaveri Online Services, got approval in two days, paid the government fee, and booked a registration slot.
3. Printed the sale deed on legal document paper.
4. Scheduled registration at K.R. Puram Sub-Registrar’s Office 
5. On the day of registration, all parties carried required documents:
   • Seller’s Documents: Original sale deed (from 2011), Encumbrance Certificate, e-Khata, tax paid receipt, Aadhaar, PAN.
   • GPA Holder’s Documents: GPA, passport & PAN copy of Mrs. Priya, application summary report, sale agreement, printed sale deed, Aadhaar.
   • Bank Representative’s Document: Cheque for final payment.
6. Submitted the application summary report at the registration counter.
7. Seller and buyer (GPA holder) signed all pages, and two witnesses signed the last page.
8. Thumb impressions, webcam photos, and OTP authentication were completed.
9. Final payment was handed over to the seller, and in return, the seller provided:
   • Original sale deed
   • e-Khata
   • Tax paid receipt
   • Property keys
10. The bank collected all original property documents, while the GPA holder kept photocopies for further proceedings like Khata transfer, name change in property tax records, and utility bill updates.

Below is the image of registered sale deed: