Buying Property In Goa Might Be Difficult For Foreigners.

Chief Minister of Goa, Mr. Digamber Kamat said that his government is seriously considering regulating the sale of property to foreign nationals in the state. The Goa government is working out on a bill to tense up the control on sale of land to foreigners. On this issue, Mr. Kamat said, “It’s not yet a cabinet decision but we are all concerned about how the image of Goa is being ruined in the wake of certain incidents involving foreign nationals”.

While Law Minister Dayanand Narvekar has announced that the government has decided to ban foreigners from buying properties in Goa, the ground reality may be different.

Mr. Narvekar told in a press conference,“The government has decided to bring in the Legislative Assembly an amendment to Section 22 of the Registration Act, which will empower the State government to ban the sale as part of its public policy”. But he elaborated by saying that registration of sale of land to any foreigner henceforth will require clearance from the Reserve Bank of India. However, Foreign Exchange Management Act (FEMA) does not mention that an NOC is necessary for buying property.

State Chief Registrar Mr. Vithal Salkar opined that this only indicates that there is no provision under FEMA that permits RBI to give an approval for property transactions by a foreign national in India. Some legal experts opined that Article 245 of the Constitution will nullify the State legislation which contravenes central enactment unless the State legislation has been reserved for or receives assent of the President of India.

Former Advocate General A N S Nadkarni said, “It is too early to analyse anything now, but with 100% Foreign Direct Investment being permitted, it is to be seen how proposed curbs would stop a foreign national from buying land.”
Another point that is raised is whether the government intends to bar foreigners from buying properties or whether the decision is mainly to meant to impose some restrictions so that FEMA provisions are not violated.

The sale of land to the foreigners had become a contentious issue in Goa with the State government unearthing 400-odd cases of sale of properties to foreigners.


  1. Posted March 19, 2008 at 4:48 am | Permalink

    Amending a 100-year-old act, the Goa [Images] government on Friday decided to ban the sale of land to foreigners in the state.

    “It’s a policy decision that foreigners will not be allowed to purchase land in Goa. Earlier, there were no proper powers (given) to the registration authorities in Goa to check whether the Reserve Bank of India [Get Quote] had cleared a deal,” state law minister Dayanand Narvekar said.

    The Goa government has decided to bring in the legislative assembly an amendment to Section 22 of The Registration Act, 1908, which will empower the state government to ban the sale as part of public policy. The budget session of the assembly begins on March 24.

    The sale of land to the foreigners had become a contentious issue in Goa with the state government unearthing 400-odd cases of sale of agricultural property to foreigners.

    The state government had constituted a committee, which studied all the proposals threadbare and referred 298 cases to the Union Enforcement Directorate for further action.

    Officials said that these cases had clear evidence of foreigners buying properties in Goa in violation of the Foreign Exchange Management Act.

    Narvekar said that Section 22 of the act empowers the state government to refuse registration of certain documents which are opposed to public policy.

    The minister said that the state government will be able to control the ‘pumping in of black money in the state’ for purchase of property.

    “Only in case of RBI clearance, they will be able to purchase the property. But it’s very difficult to get the bank’s clearance as they cross check the deal on every aspect,” the law minister said.

    Referring to the earlier instances of foreigners purchasing properties in Goa, Narvekar said that in 90 per cent of the cases there was no RBI clearance.

    “Even if the foreigners enter into the partnership with an Indian and wants to buy property, RBI clearance is mandatory,” he said.

    He said that the properties of the foreigners, who have violated FEMA, will be confiscated by the government on RBI recommendation.

  2. Posted March 19, 2008 at 6:23 am | Permalink

    Here are the facts about buying property in Goa. Any foreign national who desires to buy in Goa first has to reside in Goa for 182 days or more in a fiancial year. (May 1st to April 31st). However, it is also legal for a 100 percent foreign owned company to purchase property. The comapany then has to submit accounts for each financial year. The company also has to conduct meetings at which the minutes are recorded. All this has to be conducted by a company secretary which the company (represented by its director or directors) hires for a fee. The company is then free to rent out the properties acquired by it as this constitutes the carrying out of businness activities by the company. Hence the director(s) of the company are then rented out the property in which they live. The property is owned by the company at all times. However , since the directors control the company, the property is their own for all practical purposes. This is how most foreigners have bought property in Goa. It is perfectly legal as long as you adhere to the above mentioned guidelines. A point though- The government of Goa has made hasty statements that will not stand in a court of law in the republic of India. Goa would do well to realise that foreign and economic policy is dictated by the central Government in Delhi. Hence they should not go about making absurd statements as finally ,they are subject to Indian law! Further more, India is a signatory to WTO and is bound by it to allow companies to be 100 percent foreign owned and own immoveable property on Indian territory (Goa is Indian teritory even if they do not like it) I would advise most people wanting to buy in Goa to hire a Goan lawyer for the checking of papers, etc, but then take up the services of a non Goan (Indian) lawyer for company formation, set up ,etc.

  3. Posted March 20, 2008 at 1:21 am | Permalink

    i think Legislative Assembly an amendment to Section 22 of the Registration Act is the major reason for that

  4. peter
    Posted December 28, 2008 at 11:00 pm | Permalink

    small wonder brits are fed up with the whole situation they can buy property in britian but they do not want us to own even a holiday home in india we the country that allowed mittalsteel to take over most of our steel industry we are too lenient with far too many corrupt 3rd world countrys

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