NRI's CORNER
F.E.M.A.
Exempt Assets in India
returning NRIs CORNER - Exempt ASSETS
Exempt Assets are :
1.
Assets and money brought by him in India upon return to India for a period of 7 years from the year of return to India.
(Balance held in NR(E) accounts in India on date of return to India will be treated as money brought by him in India.)
2.
Assets purchased after return to India from money brought by him and from NR(E) account for a period of 7 years from the year of return to India.
3.
Assets purchased within one year before his return to India from NR(E) account or from remittances of foreign exchange.
In addition to above the following assets are also exempt to returning NRIs at par with resident 
1.
One house or plot of land.
 
Provided, Plot of land having an area of five hundred sq. meter or less.
2.
Non-resident Indian
The concessions are available to a Non Resident Indian i.e. a non-resident as defined under the Income Tax Act, 1961 being distinct from an NRI (person resident outside India) as defined under FEMA, 1999
Example -
X an Indian citizen has been residing in USA for several years, returned to India on 21.10.2009 with an intension of permanently residing here. Discuss his wealth-tax liability in the following cases:
1.
He brought Rs.25,00,000 along with him and purchased a Mercedez Car.
2.
He had sent Rs.40,00,000 to India on 5.11.2008. This money was utilised for purchase of gold on 28.11.2008. 
3.
He sent Rs.20,00,000 on 5.08.2008 and purchased a residential plot of land in Delhi on 16.08.2008.
4.
On his return he brought with him diamond jewellery worth Rs.22,00,000.
5.
He had sent Rs.31,00,000 on 04.11.2008 which was deposited in his Non-Resident Indian account with a Bank. Out of this Rs.20,00,000 was withdrawn from the Bank for purchase of urban land but he could not purchase the same till 31.03.2010.
1.
Although car is an asset but in his case it will be exempt for 7 years.
2.
In this case, the value of gold as on 31.03.2009 will be included in his net wealth for assessment year 2009-10, but from assessment year 2010-11 to 2016-17 it will be exempt u/s 5(v).
3.
In this case the value of land will be included in his net wealth not only for assessment year 2009-10 but also for subsequent years. No exemption is available as the asset was purchased more than 1 year prior to the date of return.
4.
This shall be exempt for 7 assessment years commencing from assessment year 2010-11.
5.
On 31.03.2010 he holds more than Rs.50,000 in cash, but the same will be exempt as cash is also an asset and the exemption u/s 5(v) is also available for 7 years.
 
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