RBI ordered Banks to follow the rules on the sale and purchase of real estate overseas
The RBI pointed out that bank should make sure that all future transactions related to the sale and purchase of real estate as well as acquisition on lease or rental basis at the overseas centers are done as per the board approved policy.
This directive has been issued after it came to the central bank’s notice that several Indian banks have committed certain errors in purchase and sale of real estate.
RBI Notification informs that to avoid such failure in future, the board of directors of banks should form some rules to avoid such lapses. The guidelines should be conform with the provisions of the Foreign Exchange Management Act, 1999, the Banking Regulation Act, 1949, and other relevant Indian laws.
While managing the transactions in the nature of sale and purchase of property, letting out property on lease at overseas centers, bank should make sure that bank follow all the laws of the host country or city.
Source: The Business Line
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