• Agricultural land transfer from Indian Citizen (mother-still alive) to US Citizen (son)

Sir,
I am a US citizen and sent money to my parents (in India) in 2004 to 2006 for their maintenance. My mother bought an agri land in 2006 on her name. She stated in that registration document as "I am buying this land by using money which I have received it from my son (as a gift) who is living in USA". Now she turned to 75 years old and wants to transfer that land to my name.
Q1: Are there any legal issues involved in this case?
Q2: Once it has been transferred to my name, can I sell it to any Non NRI Indian Citizens?
Q3: Should I have to pay any taxes on sale amount (I heard that no taxes on agri land sale)?

Thanks
Pratap CH.
email: [deleted]
Asked 4 years ago in Civil Law

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21 Answers

Hi, yes she can make a transfer deed in your favour...After the deed has been made in your favour you can sell it further as per your convinience

Hemant Chaudhary
Advocate, Gurgaon
4619 Answers
67 Consultations

4.9 on 5.0

1. There is no issue involved in it and hence there is nothing to get worried as well.

2. Yes, once she transfer her land to you , the ownership is transferred to you and since then you will be treated as its sole owner. However since there is an admission in the sale deed abut the source of money through which your mother purchased this property, your brother can get a declaration from court that he is the actual owner of this property and his mother was benamdar.

3. No , there is no such requirement.

Devajyoti Barman
Advocate, Kolkata
22515 Answers
402 Consultations

5.0 on 5.0

You are not an agriculturist

2) mother cannot execute gift deed of agricultural land in your name as you are not an agriculturist

3) mother can execute willbequeathing land to you

4) you can sell agricultural land inherited by you to an Indian cItizen

Ajay Sethi
Advocate, Mumbai
87932 Answers
6207 Consultations

5.0 on 5.0

NRI Cannot Acquire Agricultural Land in india by way of gift, the only way to for NRI's, PIO's to acquire agricultural in india is by way of inheritance.

Mohammed Mujeeb
Advocate, Hyderabad
19031 Answers
32 Consultations

4.5 on 5.0

No there won't be any legal issue she can make a gift deed.of the property and register same in your name by paying appropriate stamp duty.

Yes you can sell it to non nri citizen.

There will be no taxes on the capital gain as the land is agriculture.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

It depends on where the land exists as many states in india prohibits non agricultural person to own land on his name. And your US citizenship status can create issue.

Abhilasha Wanmali
Advocate, Nagpur
1022 Answers
1 Consultation

4.8 on 5.0

hello

the land was bought by your mother. she wants to transfer it in your name and if she has a clear title to the land, she has full powers to transfer land to you. there would be no legal hassles involved.

once she transfers it to you, you can sell it to anybody. there would be no tax when she transfers the land to you but if you sell it for profit, which you will do, you have to pay capital gains tax.

regards

Rahul Mishra
Advocate, Lucknow
13757 Answers
65 Consultations

5.0 on 5.0

1. No

2. Yes, you can

3. As and when you get the amount transferred to your NRO account then you will have to pay taxes, advise you to get in touch with a CA in India before starting the sale proceedings.

regards

Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

Firslty, as per the information stated isn’t he present query, makes it clear that now you want that property to be mutated in your name.

Secondly, if you go by the transfer deed or gift deed then yes you may have to pay stamp duty on it.

Thirdly, but, if your mother relinquish her rights in the property to you without any consideration from you then you may not have to pay any stamp duty, and expenses would not be more than 30K.

Sanjay Baniwal
Advocate, South Delhi
5464 Answers
13 Consultations

5.0 on 5.0

in which state is this agricultural land situated?

1. Being a US citizen you are prohibited from acquiring agricultural land under the foreign exchange management act or FEMA

2. Your mother cannot even gift this agricultural land to you

3. You can only inherit this land as a legal heir

4. Or your mother can make a will wherein she can bequeath this land in your favour

5. You cannot sell agricultural land to any non Indian. You can only sell it to Indian residents. Some states do not even allow selling of agricultural land to a non farmer. That was the reason I asked that query to you in my earlier response to which you gave a terrible rating for me without even replying

6. When you sell the land (after becoming its owner upon inheritance and not on purchase), obviously you will have to pay capital gains tax on the capital gains earned by you i.e profit on sale. After paying the capital gains tax, you can remit the balance to US through normal banking channels subject to any limit on outward remittances prescribed by RBI or under FEMA

7. If you want to save on paying capital gains tax then you can invest the capital gains in a residential house to be purchased within the prescribed limit from date of sale of land as given in s. 54 of income tax act. You can also invest capital gains in government bonds. You can consult a CA for tax planning.

8. It is to be remembered that you need to invest in the residential house or the government bond, only the capital gains (sale price minus purchase price) and not entire sale proceeds, because capital gains tax is levied on the capital gains and not on sale proceeds

9. Lastly your buyer will deduct TDS (tax deducted from source) @20.66% from sale proceeds and pay you balance. If you wish to invest in residential property or government bond then this TDS so deducted will be refunded to you by income tax department (amount will depend on the quantum of your investment)

Thanks for your rating without replying to my query

1. As there is restriction as above, what can be done is your mother can sell the land

2. There is certain exemption available from payment of tax when agricultural land is sold

3. The sale proceeds can then be gifted to you by your mother

4. You can then remit that money through normal banking channels

5. As per section 56 of income tax act money gifted to specified relatives is exempt from tax

6. You can consult a qualified chartered accountant for better perspective

Yusuf Rampurawala
Advocate, Mumbai
6881 Answers
79 Consultations

5.0 on 5.0

1. Nothing.

2. Yes.

3. All the taxes such as Stamp Duty as payable in India and all other taxes which are payable in India has to be paid.

Koshal Kumar Vatsa
Advocate, Gurgaon
2283 Answers
3 Consultations

5.0 on 5.0

1. Your mother can register a gift deed in your favour provided you have a OCI card.

2. You can sell the said land to any Indian citizen legally.

3. You have received the said land as gift for which you won't have to pay any I.tax for selling the sale immediately. If you sell it later on then the difference between the market price of the land when it was gifted to you and when it was sold by you will be considered as your capital gain on which capital gain tax shall have to be paid. I.Tax is not levied on agricultural income and in your case it is not an agricultural income.

Krishna Kishore Ganguly
Advocate, Kolkata
26602 Answers
726 Consultations

5.0 on 5.0

Your mother can execute a gift deed in your favour in order to transfer the ownership of the agricultural land to you, for which stamp duty needs to be paid and said deed needs to be mandatorily registered in sub registrar office.

After that you can sell the property to any Indian citizen too.

You would have to pay taxes as you are not an agriculturalist.

Siddharth Jain
Advocate, New Delhi
5928 Answers
101 Consultations

5.0 on 5.0

1. She cannot transfer the agricultural land to a NRI, even if he is her son and that he funded for the purchase of this property, either by a gift deed, or settlement deed or sale deed.

The son can inherit the property after her lifetime as her legal heir.

2. When there is no provision in law to transfer the agricultural land to NRI this question does not arise.

3. The above answer suits this question too.

If your mother is drawing up a Will bequeathing this agricultural landed property to your name then you can acquire the same by enforcing the Will after her lifetime by getting probate of Will from a court of competent jurisdiction.

Please remember that if the property is an agricultural land, plantation property or farm house, it can be gifted only to a person resident in India who is a citizen of India.

T Kalaiselvan
Advocate, Vellore
78089 Answers
1543 Consultations

5.0 on 5.0

On your mother demise apply for probate of will

2) notice would be issued to your brother and other siblings

3) if there are no objections received you would get probate in your name

4) consent of nephew is not required

5) court does not go into source of income for purchase of agricultural land

6) your brother would not get any declaration from court that he is owner of land

Ajay Sethi
Advocate, Mumbai
87932 Answers
6207 Consultations

5.0 on 5.0

1. when you will approach the land record authority to have your name entered on basis of the Will in your favour, the authority will require you to submit the NOCs of all the legal heirs of the deceased saying that they accept the Will and have no objection against the mutation in your name

2. court is not concerned with source of income

3. the money sent by you to your mom was a gift. It became her personal property. She could do whatever she wanted with that money including buying agricultural land.

4. the chances of raising the contention of the land being a benami property cannot be ruled out.

5. instead of Will, it is advisable that the land be sold now itself in the lifetime of your mom and the proceeds can be gifted to you, to avoid any future complications. If the Will is disputed by any legal heir then things will get stuck

Yusuf Rampurawala
Advocate, Mumbai
6881 Answers
79 Consultations

5.0 on 5.0

Your mother has committed a fault that she has purchased land in her name by your money so now whatever the source of income or the money used for the purchase , your brother has equal right which your have or whoever the legal heir of your mother so there shall be chances that Will can be challenged so it is advised that to obtain signatures of all legal heirs of your mother whatever the documents she will sign to transfer the land to you. No court will ask the source of income which is already there.

Koshal Kumar Vatsa
Advocate, Gurgaon
2283 Answers
3 Consultations

5.0 on 5.0

1. Your mother cannot transfer the agricultural property to you by gift deed or any other mode except by Will or it can be an intestate succession, since you are a NRI.

The court will not go into the details of source of income of your mother for purchasing this property.

Your brother and other legal heirs of your mother need to give NOC for this property to be transferred to your name by enforcing the Will in your favor or you can obtain probate of the same.

2. Since this property is in your mother's name, she will be the absolute owner. She need not show the source of income since this becomes married women property hence she will be the absolute owner of the same. Your brother has got nothing to contest over this nor it will be maintainable.

T Kalaiselvan
Advocate, Vellore
78089 Answers
1543 Consultations

5.0 on 5.0

1. No if there is registered will no NOC from.other legal heirs required. No the court will not as you can gift your mother amount and there is no tax issue also.

2. No as you can claim that you have gift said amount to mother and she purchased land from.same further the source of income is your taxable income.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

1. a. In case of availing probate of the will, copy of your application of probate will be sent to all the legal heirs of your mother to enable them to contest the application or consset it. So, you do not need any of their signatures on any paper in this specific matter.

b. The Court will not see from where your mother5 has received the money for buying the said land in the instant matter. It is the case of granting probate of the will only.

2. The sakle deed states that the money was received by your mother from you for buying the said land. In the instant case, you could have claimed the property as the Benami property of yours, had it been purchased beforev the year 1988. Your brother will have no claim on the land as his benami property.

Krishna Kishore Ganguly
Advocate, Kolkata
26602 Answers
726 Consultations

5.0 on 5.0

1. No signature from other legal heirs required, notice will be sent to the legal heirs, if some one has objection then they can appear before the court

Court will not raise any question

Anilesh Tewari
Advocate, New Delhi
17940 Answers
377 Consultations

5.0 on 5.0

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