$1 m can be remitted overseas every year from NRO accounts

I own some real estate in India, which I inherited. I am a US citizen. If I sell the property how will the transaction be taxed under the tax laws of India and what must I do to transfer the sales proceeds to my US bank account? — Kalelkar
The long-term capital gains will be taxable in India @20.6%. In the case of property, long-term gains would accrue after a holding period of 3 years. For this, the aggregate holding period of the original holder who bequeathed the property to you as well as your own holding period will be considered. NRI or a PIO can remit as much as $1 million per year for bonafide purposes out of the sale proceeds of assets held in NRO accounts. He should have acquired the assets in question, out of rupee resources when he was in India or by way of legacy/inheritance from a person who was a resident in India. The remittance can be effected only when it is sought for all bonafide purposes to the satisfaction of the assessing officer. The procedure for the remittance process has been modified from July 1, 2009. Though this changed procedure has been mentioned in some earlier columns, we find most NRIs are not aware of the same. First, you would need to provide the bank with a certificate from an Indian chartered accountant. This certificate is to be provided in prescribed Form 15CB. You would also need to fill Form 15CA. This Form 15CA also known as the ‘undertaking’ requires the remitter to furnish certain specified details regarding the proposed remittance. The information to be furnished in Form 15CA is to be filled using the information contained in Form 15CB (certificate). Form 15CA has to be then uploaded on www.tin-nsdl.com. The remitter will then take a printout of this Form 15CA (which will bear an acknowledgement number generated by the system) and sign it.

The duly signed Form 15CA (undertaking) and Form 15CB (certificate), has to be submitted to the bank, which will, in turn, forward a copy of the certificate and undertaking to the assessing officer concerned.

Once this is done, the funds may be remitted abroad. Please note that though the procedure seems complicated at first glance, it basically amounts to filling out two forms, one of which will be done by the chartered accountant concerned. The other one has to be filled online and then printed out with the system generated acknowledgement number. Submission of both these documents is all that is needed to effect the remittance.
The writer is director, Wonderland Consultants, a tax and financial planning firm. He can be reached at sandeep.shanbhag@gmail.com