For the large Banarasi diaspora in the US, UK, Gulf and beyond, buying property back home in Varanasi is both an emotional and a financial decision. The good news: the process is well-defined and entirely doable remotely. Here is what you actually need to know.

What NRIs Can and Cannot Buy

Under FEMA (Foreign Exchange Management Act), an NRI or OCI can freely purchase residential and commercial property in India — no special permission needed. What you cannot buy is agricultural land, plantation property, or a farmhouse. If a Varanasi plot is described as "agricultural" or near-rural, confirm its land-use classification before proceeding; converted residential land is fine, raw agricultural land is not.

How to Pay

All payments must come through banking channels — your NRE, NRO or FCNR account, or via normal inward remittance. You cannot pay in foreign currency or cash. Keep every bank record; you will need them later for repatriation.

The Power of Attorney (PoA) Route

Most NRIs cannot fly to Varanasi for every signing. The standard solution is a registered Power of Attorney given to a trusted family member or representative in India. The PoA should be:

  • Drafted specifically for the property transaction (not a generic one)
  • Signed before the Indian Consulate in your country, or notarised and apostilled
  • Then adjudicated and registered in India

A property-specific, registered PoA is what protects you — a vague PoA is a risk.

Taxes You Should Plan For

  • TDS on purchase: When you buy, TDS rules apply on the transaction.
  • Capital gains: If you sell later, capital gains tax applies — long-term rates after two years of holding, with indexation benefits.
  • Rental income: Taxable in India; your tenant may need to deduct TDS on rent paid to an NRI.
  • DTAA: India has Double Taxation Avoidance Agreements with most countries — you will not be taxed twice, but you must file correctly in both.

Repatriation

You can repatriate sale proceeds — subject to limits and conditions — provided the original purchase was made through proper banking channels and you have the documentation. This is exactly why keeping every NRE/NRO record from day one matters.

Buying Remotely — The Practical Checklist

1. Shortlist properties online and request a live virtual tour — see the actual property and neighbourhood in real time.

2. Get an independent title verification done before paying anything.

3. Confirm RERA registration for any under-construction project.

4. Execute a property-specific registered PoA.

5. Make all payments through your NRE/NRO account.

6. Arrange ongoing property management if the home will sit vacant or be rented.

The biggest risk for NRI buyers is not the law — it is buying blind and leaving the property unmanaged. Use virtual tours, verify the title independently, and keep a local management partner. Our NRI Property Management service is built specifically for overseas Banarasi families who want their hometown investment handled properly.