Can NRIs Sell Their Agricultural Land in India and Transfer Money Abroad?

NRIs (Non-Resident Indians) frequently ask whether they are allowed to sell agricultural land in India and then repatriate the sale proceeds to their country of residence.
The rules for ownership, sale, and repatriation of agricultural land for NRIs are governed by:

• FEMA (Foreign Exchange Management Act)

• RBI Guidelines

• State land laws

This blog explains everything in a simple and practical manner.

🔹 1. Can NRIs Own Agricultural Land in India?

✔ NRIs cannot purchase agricultural land, plantation land, or farmhouses in India.

However—

✔ NRIs can inherit agricultural land legally.

If the land came through:

• Inheritance from parents or grandparents

• Gift from a relative as per FEMA rules

• Succession or partition within the family

→ The NRI becomes a valid legal owner and can sell it.

🔹 2. Can NRIs Sell Agricultural Land in India? — YES

An NRI is allowed to sell agricultural land, provided:

✔ They acquired it legally (inheritance / gift / family division)

✔ There are no title disputes

✔ The land complies with state agricultural laws

✔ Proper documentation is available (mutation, fard/jamabandi, will, gift deed, etc.)

Who can NRIs sell agricultural land to?

This depends on state laws.

Example: Punjab, Haryana, Delhi, UP, MP, Rajasthan

✔ NRIs can sell agricultural land to:

• Farmers

• Indian citizens interested in buying agriculture land (subject to state rules)

🔹 3. Can NRIs Transfer Money Abroad After Selling Agricultural Land? — YES, BUT WITH CONDITIONS

Repatriation is allowed, but through the proper FEMA-compliant process.

⭐ RBI Guidelines for Repatriation:

1. Money must be deposited into the NRI’s NRO Account (oddly, not NRE).

2. NRI can repatriate up to USD 1 million (approx ₹8.3 crore) per financial year, including:

   • Sale proceeds

   • Inherited assets

   • Gifts received

   • Other eligible assets

3. To repatriate, the bank will ask for:
   ✔ Sale deed
   ✔ Proof of inheritance/gift
   ✔ Form 15CA & 15CB (from Chartered Accountant)
   ✔ PAN Card
   ✔ NRO bank details

4. Taxes must be paid in India before repatriation.

⭐ After tax compliance → bank permits remittance to foreign account.

🔹 4. Tax Implications for NRIs Selling Agricultural Land

✔ Long-term capital gain (LTCG) applies if land held > 2 years

Tax @ 20% after indexation.

✔ Short-term capital gain (STCG) applies if held < 2 years

Tax as per slab.

NRIs must obtain a CA certificate (Form 15CB) confirming tax has been paid.

🔹 5. Step-by-Step Process for NRIs Selling Agricultural Land & Repatriating Money

Step 1: Confirm legal ownership & clear title

Mutation / will / inheritance documents must be updated.

Step 2: Execute sale deed with the buyer

Presence in India is not mandatory —
✔ NRI can give Special Power of Attorney to a family member to sign the sale deed.

Step 3: Deposit sale proceeds in NRO Account

This is compulsory by law.

Step 4: Pay applicable taxes (TDS, capital gain tax)

Step 5: Apply for repatriation

Submit to the bank:

• Form 15CA (online)

• Form 15CB (CA certificate)

• Copy of sale deed

• Inheritance documents

Step 6: Bank remits money abroad

Usually within 2–5 working days after approval.

🔹 6. Common Mistakes NRIs Should Avoid

❌ Selling without clear title or pending mutation
→ Causes income tax complications

❌ Depositing money directly into NRE account
→ Not allowed for sale proceeds

❌ Not taking CA certificate (Form 15CB)
→ Bank will not repatriate

❌ Using a general power of attorney (GPA) instead of SPA
→ Banks and registries often reject it

❌ Not paying capital gain tax before repatriation
→ Remittance gets blocked

⭐ Conclusion

✔ NRIs can sell agricultural land in India if it is inherited or gifted legally.
✔ They can transfer (repatriate) the sale proceeds abroad, up to USD 1 million per financial year, after fulfilling FEMA and tax rules.
✔ Proper documentation, NRO account deposit, and CA certification are mandatory parts of the process.