How is property sale by a person of Indian origin taxed?

livemint.com:

—Name withheld on request Since you have highlighted the 120-day visit rule, I assume that you are a person of Indian origin for that purpose of ascertaining residency under Indian tax laws (i.e. you or one of your parents or grandparents was born in an undivided India). I also assume that you earn more than ₹15 lakh income in India.

You are correct that a person of Indian origin having more than ₹15 lakh income in India becomes a ‘resident’ if (a) their visit to India in a particular financial year amount to more than or equal to 120 days and (b) they would have stayed in India cumulatively for more than or equal to 365 days for the previous four financial years. However, if the individual’s period of stay remains below 182 days in the respective financial year, then this person qualifies as a ‘not ordinarily resident’. In your case, since you spend 4-5 months every year in India, you will qualify as a ‘resident but not ordinarily resident’ (RNOR).

For RNOR tax status, though incomes accruing outside India (barring some) are not taxable in India, incomes accruing in India remain taxable in India. Therefore, gains on the sale of Indian property will be taxable in India. ‘Resident’ includes RNOR, thus the buyer needs to deduct TDS at 1% (no additional surcharge or cess) while paying you the gross sale consideration and not at 20%.

This is on account of the reason that you are still a ‘resident’ although living outside India. If the property qualifies as a long-term asset (holding of more than 2 years), then gains (after indexation) would be taxed at 20% (plus applicable surcharge and cess). Otherwise, capital gains would be taxed as normal income at the applicable slab rates.