Hello John.
Sure it is possible to buy a new or second hand bullet in India. I did it both. Second hand in Delhi and new in Margao Goa. New is a little bit more complicated and only possible when you have plenty of time.
The system in India is that all the roadtaxes are being paid for the entire life and since you are not indian you cannot do it straight.
The easiest way is to buy second hand and go for 350cc. 500cc not very good.
The only paper you need is a signed paper from the last owner in wich he confirmes the bike is sold to you. The official registerbook stays on the name of the very first buyer (new). Be sure you get insurance, a few 100 rp, and a recent gastest.
When the dealer has internet he can log in on Madaan motors Delhi. On his site is the procedure in detail explained.
When you have plenty time than you can opt for a new one.
This is the procedure:
The dealer asks somebody from his workshop to buy, with your money. The bike will be registered in his name.
Go together to an advocate for a ownership transferpaper, About 500 rp included an official stamp.
Let the dealer arrange an insurance.
Still not possible, Take the train to Margao(Madgaon) in Goa. Sainimotors 10 min from railwaystation and try your luck there because they are used to foreigners.
Good luck.
Metita, now in Thailand and end jan in Goa riding his own Bullet.