STAMP_ACT

The Bombay Stamp Act, 1958 Lecture & Presentation By P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Types of Documents z

Specified Documents – Covered under the Indian Stamp Act, 1899 (Central Act) - listed in Entry 91 of List-1 of Schedule VII of the Indian constitution

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Documents other than specified – Covered under respective State Acts. In Maharashtra, the Bombay Stamp Act, 1958 (State Act) – Listed in Entry 91 of List-II of Schedule VII of the Indian constitution P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Specified Documents covered by Indian Stamp Act z z z z z z z

Bills of Exchange Promissory Notes Bills of lading Letter of Credit Insurance Policies Share Transfers Proxies P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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Stamp duty is a kind of Tax like Sales Tax or Income Tax. Needs to be paid in full and in time. Delay in payment or short payment attracts penalty – 2 % per month on deficit – Maximum 200% Duly stamped document is admitted as evidence. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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If the document is unstamped or understamped Court may impound the document for penalty and has discretion not to get admitted as evidence. Payment should be before execution of document or at the time of execution. Any party to the document can pay stamp duty. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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Stamp paper must be purchased in the name of any of the party to the document, w. e. f. 01.05.1994. Stamp in the name of Advocate / CA / consultant etc. not allowed. Stamp must be used within six months from date of purchase w. e. f. 01.05.1994. After six months it is mere piece of paper. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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Stamp duty should be paid on consideration value or market value whichever is high for transfer of property. If the property is sold by Govt. or Semi-Govt. bodies or local authorities e.g. MHADA, CIDCO, BPT, MC, MIDC etc, or Income Tax Dept. then value declared by these departments in notice is treated as final market value. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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Only authorized vendors can sale the stamps. For charging stamp duty, the instrument is not to be treated by the name it bears but by the substance or real nature of the transaction recorded therein.

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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The stamp duty is imposed upon the instrument and not upon the transaction. The instruments or the documents have to be read as they are i. e. as they are worded or drafted. Nothing is legal that adopts a method in effecting a transaction so as to reduce or lesson the liability of stamp duty. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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The Act is a fiscal measure enacted to secure revenue for the State from certain classes of instruments. A document which is not stamped, though required to be stamped or is an understamped, is not by that reason, invalid as between the parties. (C. C. R. A. Vs. Maharashtra Sugar Mills, 52, BLR 82.) P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

Stamp Act is fiscal measure enacted to secure revenue for the state on certain cases of instruments. It is not equipped to arm litigant with a weapon of technicalities. (Hindustan Steel Ltd. Vs. M/s Dilip Construction Co., AIR 1969 SC 1238) P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

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The Act being a fiscal statute it is to be interpreted strictly and in a manner in favor of the subject. (Fernandez Vs. State of Kerala, AIR 1957 SC 657) The Stamp Act has to be construed strictly as it is a taxing statute. (Hindustan Lever Ltd. Vs. Municipal Corporation 1995-3 SCC, 716) P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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General points about Stamp Act z

The object of the Stamp Act is to collect proper stamp duty on an instrument or conveyance on which such duty is payable. The imposition of stamp duty on sale deeds is on the actual market value of such property and not the value described in the instrument. An obligation is cast on the authority to properly ascertain true market value of the property and for that purpose the authority is not bound by the apparent tenor of the instrument. P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Acknowledgement – Article 1 Acknowledgement by a debtor z

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Exceeds Rs. 5,000/- but below Rs. 10,000/……… Rs. 1/For every Rs. 10,000/- or part thereof above Rs. 10,000 …………Rs. 1/- subject to

maximum of Rs. 100/P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Affidavit – Article 4

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affidavit the stamp duty is Rs. 100/-

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Agreement – Article 5 z

If relating to giving authority or power to a promoter or a developer for construction on, development of or sale or transfer of any immoveable property ……… same duty as for conveyance under clause (b), (c), or (d), as the case may be, of Article 25 on market value of property Article 5(g-a)(i) P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Agreement – Article 5 z

If relating to purchase of unit in any scheme or project by a person from a developer ……… same duty as for conveyance under clause (b), (c), or (d), as the case may be, of Article 25 on market value of property Provided that at the time of conveyance this duty paid will be adjusted if conveyance is made within one year. If no duty is payable ……… Rs. 100/Article 5(g-a)(ii) P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Agreement relating to Deposit of Title Deed – Article 6(1) z

Where such deposit has been made by way of security for the requirement of many advanced or to be advanced by way loan or an existing or future debt …….. Rs. 1/- for every Rs. 10,000/- or part thereof for the amount secured by such deed subject to minimum of Rs. 100/- and maximum Rs. 5,00,000/P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Agreement relating to Pledge and Hypothecation – Article 6(2) z

Where the pledge or hypothecation of movable property is to secure the repayment of money advanced or to be advanced by way of loan or an existing or future debt …… Rs. 1/- for every Rs. 1,000/- or part thereof for the amount secured subject to minimum of Rs. 100/- and maximum Rs. 5,00,000/P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Bond – Article 13 z

Not being a debenture or otherwise provided by the Bombay Stamp Act or Bombay court Fees Act, 1959 …… for every Rs. 500/- or part thereof Rs. 5/- (i. e. 1% of value), subject to minimum of Rs. 100/-

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Conveyance – Article 25 (C)(vi)(b) z

If instrument transferring the property is nonresidential within the Municipal Corporation of cities of Pune, including the Cantonments of Pune and Kirkee ……. For every Rs. 500/- or part thereof Rs. 25/- (i. e. 5% of value)a

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Conveyance – Article 25 (C)(d)(i) z

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If instrument transferring the property is residential and the value of property is Up to Rs. 2,50,000/- ……… duty Rs. 100/Up to Rs. 5,00,000/- ……… duty Rs. 100/+ 3% of value above Rs. 2,50,000/Above Rs. 5,00,000/- ……. duty is Rs. 7600/- + 5% of value above Rs. 5,00,000/-

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for Further Mortgage Charge – Article 33(b)(ii) z

Instrument imposing a further charge on mortgaged property, when the first mortgage is without possession and further charge is also without possession ……. Rs. 5/- for every Rs. 1,000/- or part thereof for the amount secured by further charge, subject to minimum of Rs. 100/- and maximmun of Rs. 10,00,000/P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Stamp duty for

Mortgage Deed – Article 40 (b) z

When possession is not given or agreed to be given …… for every Rs. 500/- or part thereof Rs. 5/- (i. e. 5% of amount secured) subject to minimum of Rs. 100/- and maximum of Rs. 10,00,000/-

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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Thanks Lecture & Presentation By

P. R. Kulkarni Managing Director Fluent Consultants Pvt. Ltd., Pune

P. R. Kulkarni, Managing Director, Fluent Consultants Pvt. Ltd., Pune

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