![]() ![]() What is significant to notice is that this Section declares that any such agreement will be valid if the same is done with the permission of the Central Government or the RBI. Section 47 of FERA clearly envisages that no person can enter into any contract or agreement which would directly or indirectly evade or avoid in any way the operation of any provision of FERA or of any rule, direction or order made thereunder. The general policy does not allow foreign investment in landed property or the buildings constructed by foreigners and does not allow them to enter into real estate business to eschew capital repatriation, including the purport of other provisions of FERA, such as Sections 47, 50 and 63.The consequences of failure to seek previous permission has not been explicitly specified under FERA, but then the purport of Section 31 of FERA as explained above, must be understood in the context of intent with which it has been enacted.Only then such transfer could take place. If a person intends to dispose of such property by sale, mortgage, lease, gift, settlement or otherwise, they are expected to obtain previous general or special permission from the RBI. A person who is not a citizen of India, holding immovable property situated in India, is obliged to make disclosure and declaration in that behalf to the RBI.The said notification had no application to foreigners or a person who is not a citizen of India, namely, foreign citizens. The notification was limited to transaction entered into by a foreign citizen of ‘Indian origin’, to deal with real estate in India on certain conditions. ![]()
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