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Business Standard
3 days ago
- Business
- Business Standard
Returning to India? Tribunal ruling may hit property, gifts, fund transfer
A recent tribunal decision has reopened a long-standing debate on when a returning Non-Resident Indian (NRI) officially becomes a 'resident' under Indian law. This status isn't just a bureaucratic label—it directly impacts your ability to buy property, hold bank accounts, invest, or even receive gifts. The conflict Under RBI rules, NRIs returning to India must convert their NRO/NRE accounts into resident accounts almost immediately upon arrival if they intend to stay for good. FEMA, however, contains a provision that — if interpreted flexibly — treats NRIs as residents from the day they arrive with an intention to settle or work. The Tribunal, however, has decided otherwise: To be considered a resident under FEMA, two conditions must be met: Intent – The person must intend to stay in India permanently or for an indefinite period for employment, business, or vocation. Physical Presence – They must have stayed in India for at least 182 days in the preceding financial year. This literal interpretation creates a year-long limbo for many returning NRIs, especially those arriving after September — they would neither be considered residents under FEMA nor be allowed to operate fully as non-residents due to RBI account conversion requirements. One of the core reasons this ruling matters lies in how India's exchange control framework works. Under the Foreign Exchange Management Act (FEMA), whether you can gift assets, buy property or shares, repatriate money abroad, or even carry out certain investments depends on your residential status. This status is determined not just by how many days you spend in India, but also by your intention to stay. "Under Indian law, the concept of residency diverges under the tax laws and FEMA. While the tax laws provide for a definitive day-count test (primarily 182 days) to determine tax residency, FEMA evaluates both the number of days stayed in India and the individual's intention to reside or stay abroad. The tribunal's dual-condition test requiring both physical presence and demonstrable intent aligns with FEMA's flexible and purpose-driven interpretation, which overrides the rigid 182-day rule under the tax law. Accordingly, even if a returning NRI qualifies as a tax resident, they may still be treated as a non-resident under FEMA if they intend to return abroad. Pursuant to RBI directives, NRE/NRO accounts must be reclassified to resident accounts upon acquiring resident status under FEMA, not merely upon meeting tax residency thresholds. Banks, therefore, rely on FEMA's intention-based test and may require declarations and supporting documents before mandating account conversion. For NRIs returning mid-year, particularly post-September, challenges may arise around property purchases, investment eligibility, and bank account reclassification, as regulatory benefits and obligations shift based on residency status under both frameworks," explained Aurelia Menezes, Partner, King Stubb & Kasiva, Advocates and Attorneys. Obstacles for NRIs Arriving mid year, as explained by Alay Razvi, Managing Partner, Accord Juris If an NRI returns after September: They will not have spent 182 days in India in the previous financial year, and by the tribunal's interpretation, may not be a 'resident' until the next year. This delays the ability to: - Purchase property (especially agricultural land, which is restricted to residents) - Invest in shares or securities as a resident - Open/convert usual resident bank accounts They may be required to operate as non-residents for banking/investment purposes, or risk being in technical violation of banking/FEMA rules. NRIs in this limbo-period could face: a. Restrictions on receiving gifts of shares or funds from resident relatives, lending to non-relatives, or making certain investments reserved for residents themselves could breach limits if the recipient is not a legal resident c. Anomalous scenarios such as operating a 'resident' account when still technically non-resident or being forbidden to operate certain accounts altogether until the 182-day condition is satisfied. NRIs technically retain the right to challenge the tribunal's decision in higher (High Court/Supreme Court) forums, arguing for an interpretation based on intent/purpose of return, as is consistent with RBI's master directions. Class action or individual writs can be filed seeking clarity and practical application of FEMA that aligns with RBI guidance. The Case That Sparked It The Tribunal penalised an NRI who returned in May 2012, settled in India, and purchased agricultural land in his wife's name the same year. Despite his intent to stay permanently, he was deemed a non-resident for that year because he hadn't spent 182 days in India in the preceding year. The Tribunal Order (in a case involving Pradeep Mishra) has been misinterpreted by some to mean both conditions must be met. In fact, as Akshat Pande, Managing Partner at Alpha Partners, clarifies: 'The condition of intention to take up employment, etc., overrides the 182-day requirement.' "The tribunal's recent insistence on a past physical presence of 182 days in the previous financial year overlooks both the RBI's operational practice and the principle of 'intention-backed conduct.' This rigid interpretation risks penalising genuine returnees and creates ambiguity in routine matters like bank account reclassification, repatriation, and investment compliance. It is essential for the RBI and FEMA authorities to provide a harmonised, intention-and-conduct-based framework to ensure legal clarity for returning NRIs," said Shiju PV, Managing Partner, IndiaLaw LLP. How banks handle it Banks generally go by RBI's immediate conversion mandate once you show intent to settle, even if the FEMA 'preceding year' condition isn't met. This means: If you've taken a job or started a business, account conversion is triggered. The conversion process itself is unlikely to face resistance—banks are typically cooperative if you approach them early. Can returning NRIs manage or resolve conflicts between the tribunal's strict interpretation and the existing banking practices mandated by RBI and FEMA guidelines? "An NRI has to convert his bank account status from PROI to PRI if (i) he completes 182 days in a financial year or (ii) takes up employment or business or shows intention to stay for an uncertain period in India, whether or not he has completed 182 days in a financial year. So far they are complying with this requirement, there is no conflict. Banks are generally extremely helpful to resolve such issues if approached at the right time," said Akshat Pande, Managing Partner, Alpha Partners. There is, however, a small upside: Non-residents can still repatriate up to $ 1 million per financial year from their NRO accounts. In contrast, resident individuals face a lower Liberalised Remittance Scheme (LRS) limit of $250,000. For succession and estate planning, NRIs can continue to inherit Indian assets previously held by Indian residents under Section 6(5) of FEMA, so there is no change there. 'In terms of succession or estate planning, an NRI can still bequeath Indian assets formerly held by Indian residents under Section 6(5) of FEMA. Hence, in this area, status quo should be maintained," said Keshav Singhania, Head – Private Client, Singhania & Co. Practical takeaway: Lawyers advise following the RBI's conservative approach—re-designating your NRE/NRO accounts if your status changes—to avoid operational headaches later. Not doing so could result in transaction delays, account restrictions, or compliance disputes. 'Given the interpretational issues raised by the Tribunal, it is still advisable to follow RBI's prudent and conservative directive to re-designate NRE/NRO bank accounts. On a practical level, not doing so may cause practical challenges,' said Singhania. What Should Returning NRIs Do? Given the ambiguity and possible practical challenges (like banks freezing or delaying transactions), experts recommend following the RBI's conservative approach:
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Business Standard
04-07-2025
- Business
- Business Standard
Flat booking cancellation and refund: Evaluate finances, do due diligence
Homebuyers should understand RERA-based cancellation and refund rules before entering into a builder agreement, especially regarding earnest money and default timelines Sanjeev Sinha New Delhi Listen to This Article The Haryana Real Estate Regulatory Authority (Haryana RERA) recently denied a refund to a homebuyer whose allotment was cancelled due to non-payment of instalments. The buyer had paid less than 10 per cent of the total sale consideration. A case like this underscores the need for buyers to understand cancellation rules before entering into a purchase agreement with a developer. Rules on cancellation and refund RERA does not explicitly define cancellation provisions. 'The builder–buyer agreement (based on the RERA-prescribed model format) governs cancellation rights and consequences,' says Adnan Siddiqui, partner, King Stubb & Kasiva, Advocates and Attorneys.
News18
04-06-2025
- Business
- News18
What Is Form 26AS? The Tax Form That Can Save You From Notices
Last Updated: ITR Filing 2025: Form 26AS helps in avoiding tax notices by ensuring that TDS and TCS are correctly reflected in your tax returns. ITR Filing 2025: The income tax filing season 2025 has started, with the Excel Utilities for ITR-1 and ITR-4 already available for download on the e-filing portal. So far, a total of 1,23,075 ITRs have been filed. Those planning to file ITR need to carefully check their incomes to file their returns to avoid any future tax notices. One document can prevent costly mistakes — Form 26AS. Every year, thousands of taxpayers get IT notices due to mismatches in their reported income. In most cases, it could've been avoided by just checking this one document: Form 26AS. Here's how: What Is Form 26AS? Form 26AS is a consolidated tax statement issued by the income tax department that provides details of tax credits against your PAN. It contains details like TDS deducted by employers, banks, etc; advance tax paid; high-value transactions; and refunds issue. Why Form 26AS Is Important It helps taxpayers in many ways like ensuring that you don't under-report income, ensures refunds don't get delayed, and reduces chances of being picked for scrutiny. Aditya Bhattacharya, partner at King Stubb & Kasiva, Advocates and Attorneys, said, 'Form 26AS is a consolidated tax statement that provides details of tax credits against your PAN. It helps in avoiding tax notices by ensuring that the tax deducted at source (TDS) and tax collected at source (TCS) are correctly reflected in your tax returns." If there are discrepancies between Form 26AS and your tax return, it could lead to notices from the tax department. By reviewing Form 26AS, you can ensure all your tax credits are accounted for, thus preventing potential issues with tax authorities, he added. Common Mistakes To Avoid Form 26AS: What To Do If There's A Mismatch? AIS Vs Form 26AS: What's The Difference? In recent years, the income tax department introduced the Annual Information Statement (AIS) as a more comprehensive version of Form 26AS. While AIS covers a wider range of financial information, it doesn't replace Form 26AS entirely — both documents still coexist, and each serves its own purpose. What is AIS? The Annual Information Statement provides a detailed snapshot of your financial transactions as reported by various entities (like banks, mutual fund houses, registrars, etc.) to the income tax department. It includes TDS and TCS data, interest income from savings and FDs, mutual fund purchases and redemptions, share trading activity (scrip-wise), credit card bill payments, high-value purchases, and property transactions, among others. What Is Form 16, When Will You Get It? Form 16 is an income tax certificate issued by your employer. It shows a detailed summary of your salary paid, TDS (Tax Deducted at Source) deducted by the employer, and deposited with the Income Tax Department on your behalf. In simple terms, it is your proof of tax deducted and is used while filing your Income Tax Return (ITR). Employers must issue Form 16 by June 15 of the next financial year after deducting TDS. So, for FY 2024-25, your employer must provide Form 16 by June 15, 2025. About the Author Mohammad Haris Haris is Deputy News Editor (Business) at He writes on various issues related to markets, economy and companies. Having a decade of experience in financial journalism, Haris has been previously More Stay updated with all the latest business news, including market trends, stock updates, tax, IPO, banking finance, real estate, savings and investments. Get in-depth analysis, expert opinions, and real-time updates—only on News18. Also Download the News18 App to stay updated! Location : New Delhi, India, India First Published: June 04, 2025, 10:34 IST
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Business Standard
30-04-2025
- Business
- Business Standard
100 days of Trump: Immigrants, international students, refugees in a limbo
April 30 marks 100 days since US President Donald Trump took office for the second time. In this short span, his administration has introduced sweeping changes to the country's immigration system, reshaping border enforcement, legal migration, humanitarian pathways and visa rules. While the focus has been on restricting entry and stepping up deportations, there are some pro-immigration proposals too, though they remain limited and largely unimplemented. 'Trump's policies seem to be a blend of economic priorities and stringent immigration reform. While there are opportunities for highly skilled Indian professionals and students with advanced degrees, the environment remains challenging for those not aligned with specific labour market needs,' Prashant Ajmera, immigration lawyer at Ajmera Law Group told Business Standard. Ajmera pointed to sectors like artificial intelligence, renewable energy and healthcare as offering relatively secure pathways. 'Strategic education and career planning are now more important than ever,' he said. Many of the administration's decisions have already landed in court. Some measures to restrict university grants and student visas have been stayed. For example, the F-1 visa programme — which had initially faced suspension — was reinstated following judicial intervention. 'One of my clients, whose F-1 visa was affected, was called back to submit her passport. Her visa will be reissued, and she can now resume her studies,' said Ajmera. Even where reforms may be necessary, Ajmera said extreme measures have backfired. 'The system is resilient. Aspirants must stay vigilant and adaptive,' he said. Legal and labour divide 'Trump's first 100 days have created mixed outcomes for Indian immigrants and students,' Aurelia Menezes, partner at King Stubb & Kasiva, Advocates and Attorneys told Business Standard. According to Menezes, there are two student-focused opportunities under discussion: A green card for graduates — intended to retain skilled talent A merit-based immigration system — prioritising employability and education 'The green card policy is more concrete. The merit-based model is still being advocated, but we don't know how or when it may take shape,' she said. Alongside these, several restrictions are already being felt: < Mandatory identity documents for all immigrants in the US, with risk of deportation or detention for non-compliance < Limits on Optional Practical Training (OPT) and STEM extensions, which many students use to gain work experience and transition to H-1B < Shortened visa durations to four years, causing uncertainty for PhD and graduate students < Growing visa denials, requests for evidence, and delays for H-1B and H-4 holders, affecting families that rely on dual incomes 'It feels more like a crackdown than a reform. For many, it's proving to be a bane rather than a boon,' said Menezes. Proposed gold card to replace EB-5 The administration has floated a new 'Gold Card' programme that would offer permanent residency to wealthy foreign investors willing to invest at least $5 million. This is being considered as a replacement for the EB-5 investor visa, which currently requires an investment of $800,000 to $1.05 million, depending on location and project. While no formal legislation has been introduced, President Trump has described the Gold Card as a way to "bring in the best investors from around the world." Some experts believe the price point may restrict demand, especially from emerging markets. Border as a battleground Proclamation 10886, issued on January 20, declared a national emergency and called unauthorised migration an "invasion." Executive Order 14167 followed, deploying 10,000 troops and allocating $376 million to border security. National Security Presidential Memorandum 4 granted military control over certain federal lands, where migrants could be detained for trespassing. The border wall is back in focus too. In March, $70 million was sanctioned for seven miles of new barriers in Texas. Border encounters have plummeted — just 7,181 in March 2025, a 95% fall from the same month last year. Inside the deportation machinery The White House has declared a target of one million deportations a year. By comparison, the previous high was 267,000 in 2019. ICE (Immigration and Customs Enforcement) has been instructed to: < Expand expedited removal to cover undocumented individuals anywhere in the US < Meet daily arrest quotas of 1,200 to 1,500 < Permit enforcement at previously protected spaces like schools, hospitals and places of worship < Revive controversial 287(g) agreements allowing local police to enforce federal immigration laws As of April 2025, 456 such agreements are in place across 38 states. However, only 12,300 individuals were removed in March 2025, reflecting legal, operational and funding constraints. Detention centres are already overcrowded, and many deportation orders are being challenged in court. Shutting humanitarian routes Several humanitarian pathways introduced under the Biden administration have been shut down: CBP One app was suspended, leaving 270,000 migrants stranded in Mexico Central American Minors programme terminated Parole revoked for migrants from Cuba, Haiti, Nicaragua and Venezuela Refugee admissions suspended, cancelling over 10,000 scheduled flights Temporary Protected Status (TPS) has been revoked for nationals from Venezuela, Haiti, Afghanistan and Cameroon, though courts have paused some terminations. Refugees and parolees in limbo A new executive order has declared refugee admissions will resume only if they serve "national interest." Resettlement agencies report mass layoffs due to stalled processing. About 600,000 refugees were under consideration when admissions were frozen. Uniting for Ukraine and Afghan parolees are currently exempt. Meanwhile, parole revocation notices were sent to nearly a million CBP One app users, instructing them to leave the US or face a permanent ban. Detention doubled ICE has increased detention capacity, with plans to reach 100,000 beds. Over 49,000 individuals were in custody as of early April. Key moves: $45 billion proposed for new detention infrastructure Reopening of family detention centres in Texas Plans for mass detention at military bases including Guantanamo Bay Advocacy groups report: Overcrowded facilities Poor hygiene and medical care Revived family detention raising mental health concerns, especially for children Visa revocations spark fear Nearly 1,500 student visas were revoked under a new 'Catch and Revoke' programme, using AI to scan social media for perceived extremist content. Most affected students were unaware of their visa status until they received emails from DHS. After widespread backlash, the government said on April 25 it would reverse the cancellations and review procedures. Free speech, citizenship, and English Executive Order 14160, signed by Trump, seeks to end birthright citizenship for children born in the US to undocumented immigrants or temporary visa holders. Multiple courts have blocked this order, and the Supreme Court will hear arguments on May 15. Another order has declared English the official language of the United States, removing funding for translation services. Critics say it will disproportionately affect 68 million Americans who speak a language other than English at home. Legal battles continue The administration's use of the Alien Enemies Act to deport Venezuelans, without hearings, is being contested in courts. In one case, 137 men were sent to a prison in El Salvador without charge. The Supreme Court ruled they must be given notice and a chance to contest removal. Further litigation is underway against expanded military detention, refugee programme changes, and student visa revocations. The US government is preparing to introduce a new policy to govern the termination of SEVIS records, following lawsuits from international students over wrongful visa cancellations. SEVIS, or the Student and Exchange Visitor Information System, is the database used to track compliance of international students with their visa conditions. Last week, a federal judge in Georgia issued Temporary Restraining Orders (TROs) directing the reinstatement of SEVIS records for 133 students, including Indians, who claimed their visa status was wrongly terminated. The students, holding F-1 and M-1 visas, alleged that their SEVIS records were closed after law enforcement checks, often involving no criminal convictions or charges. The sudden cancellations left students panicked and confused, with many unaware they were even under scrutiny. A government lawyer later told a federal court in Oakland, California, that the Department of Homeland Security (DHS) was reversing the terminations. In a statement read in court and emailed to lawyers, the government said it was working on a framework to guide SEVIS record terminations going forward. 'ICE is developing a policy that will provide a framework for SEVIS record terminations. Until such a policy is issued, the SEVIS records for plaintiff(s) in this case (and other similarly situated plaintiffs) will remain Active or shall be re-activated if not currently active and ICE will not modify the record solely based on the NCIC finding that resulted in the recent SEVIS record termination,' the statement read.
