NRI Spouse Funded Your Property? Avoid ₹80L Tax

If your NRI husband or wife sent money to buy a property in India, the tax department can question the source. But a recent ruling shows that with the right evidence, you can fight — and win — even if one document is missing.

Here's what happened: India's Income Tax Appellate Tribunal ruled that a property purchase funded by an NRI spouse cannot be taxed as 'unexplained investment' if overall evidence is credible.. Tax officers had added ₹80 lakh to a taxpayer's income, arguing one remittance document was missing and the investment source was unproven.. The tribunal deleted the entire addition, holding that credible bank records, foreign remittance history, and consistent paperwork outweigh a single missing slip..

What you should do: Save every foreign inward remittance certificate (FIRC) when your NRI spouse transfers money to India — download from your bank immediately after each transfer.. Maintain a paper trail connecting remittances to your property purchase: bank statements, sale deed, and a written gift or loan declaration from your spouse.. If you receive an income tax notice questioning a property source, respond within the deadline with all available evidence — do not ignore or assume the case is lost..

Under Section 68/69 of the Income Tax Act, the burden of proof lies on YOU to explain the source. A notarised declaration from your NRI spouse confirming the gift or loan — filed proactively with your ITR — can prevent a notice from ever being raised.

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