Q. 1. What is the bombay stamp Act,1958?
The Bombay Stamp Act, 1958 comes into force on 16th February,
1959 and is applicable in the State of Maharashtra. This Act is intended to levy
Stamp duty on certain types of documents executed in the State or brought from outside
for acting upon the same in the State. The various instruments/documents are broadly
covered under different 62 articles listed in Schedule-I appended to the Act. The
rates at which stamp duty is levied on these documents are mentioned in Schedule
�I. The Bombay Stamp Act, levies Stamp duty on documents/instruments by which any
right or liability is, or purports to be, created, transferred, limited, extended,
extinguished or recorded. The stamp duty is payable on instrument and not on the
Q. 2. What is Stamp Duty ?
It is a type of tax which is paid for the transaction
performed by way of document or instrument under the provisions of Bombay Stamp
Act, 1958 and Indian Stamp Act, 1899.
Q. 3. Whether Stamp duty is payable
on transactions or on instruments?
It is payable on instruments and not on transactions.
The definition of the term instrument is very wide.
Q. 4. What is instrument ?
Instrument means any document by which any right or liability
is, or purports to be, created, transferred, limited, extended, extinguished or
Q. 5. What is document ?
As defined in Evidence Act, document means only matter
expressed or described upon substance by means of letters, figures or marks or by
more than any of those means intended to be used or which may used for the purpose
of recording that matter.
Q. 6. Why Stamp Duty has to paid on
The payment of proper Stamp duty on instruments bestows
legality on them. Such instruments get evidentiary value and are admitted in evidence
in Court of law. The instruments which are not properly stamped are not admitted
in evidence .
Q. 7. Which provisions/ Articles of
Indian Stamp Act, 1899 attracts Stamp duty in the state of Maharashtra ?
The following Articles of The Indian Stamp Act, 1899 attract Stamp duty in the state
Description of instrument.
Bill of Exchange
Bill of Lading-
Letter of Credit
Policy of Insurance
Q. 8. What is meant by execution of
Execution means putting signatures on the instruments
by the person/persons executing the instruments.
Q. 9. How Stamp Duty is calculated.?
Broadly the 62 articles of Schedule I are grouped in three
Category i) Articles whose amount of Stamp duty is fixed irrespective of
the value mentioned in the document / instrument. ( Viz. Administration Bond, Adoption
deed, Affidavit, Divorce, Appointment in execution of power , Apprenticeship deed,
Article of clerkship, Award, Cancellation deed, Charter party, Duplicate, Copy of
Extracts, Entry of Memorandum of Marriage, Indemnity Bond, Letter of license, Memorandum
of Association of a company, Notarial Act, Power of attorney, etc.)
Category ii) Articles where depending upon the
value mentioned in the document, the amount of stamp duty is varied. (Viz. Agreement
relating to deposit of title deeds, pawn, pledge or hypothecation, Clearance List,
Lease , Article of association, Mortgage deed, Security Bond, etc.)
Category iii) Articles which attracts Stamp duty
on the consideration mentioned in the document or True Market Value, whichever is
higher. ( Viz. Conveyance, Agreement for sale, Gift, Exchange,Partnership Deed,Partition,
Development Agreement, Transfer, Trust, etc.)
For category I and II types of instruments the Stamp duty
payable can be ascertained by referring to the Schedule I; but to ascertain the
Stamp duty on the instruments mentioned in Category III, the expertise in valuation
is required. The True Market Value is determined as per the provision of the Bombay
Stamp ( Determination of True market value of the property ) Rules, 1995.
Q. 10. What point of time of Stamp
Duty payable. ?
The Section 17 & 18 of the Act states the time of
payment stamp duty. Generally all the instruments executed in the state shall be
stamped before or at the time of execution or immediately thereafter or on the next
working day following the day of execution. Similarly, the instruments which is
executed out of the state and within three months from its receipt in the state,
shall be stamped.
Q. 11. How is Stamp Duty payable?
Stamp Duty can be paid by
1. Using Stamp paper
2. Using adhesive stamps
Q. 12. Who is liable to pay Stamp
As per the provisions of Section 30 the onus of payment of Stamp duty in the absence
of an agreement to the contrary, shall be borne by the executing in the manner provided
their with respect of certain kinds of documents viz. Mortgage deed, release, security
bond, settlement, bond etc. in the case of conveyance, the grantee and lease the
lessee shall pay the stamp duty in the case of exchange of property, both the parties
in equal share shall pay stamp duty. In case of partition, the parties thereto in
proportion to their respective shares should pay stamp duty.
Q. 13. What is meant by adjudication
of instruments? Which authority is to be approached for adjudication of instruments
? What is the amount of fees required to be paid for adjudication? What documents
are to be enclosed while submitting application for adjudication ?
Section 31, of Bombay Stamp Act, 1958 deals with the adjudication
of the instruments. Adjudication means determining the chargeability of stamps duty
on instruments. The authority to be approached is the Collector of Stamps appointed
in each District. Application for adjudication should be accompanied by � true copy
or an abstract of the instrument and also with such affidavit or other evidence
as may be necessary to prove that all facts affecting the chargeability of the instrument
have been truly setforth in the instrument along with the proof of payment of Rs.
50/- as adjudication fee. Adjudication can be done both for signed as well as unsigned
Q. 14. How to pay Stamp Duty ?
The Document which is chargeable with Stamp duty can be
prepared on the non-judicial Stamp paper of appropriate value. Unexecuted document
can be got franked with special adhesive Stamps by Franking Machine intended for
stamping such documents, by tendering required amount in the office of collector
of Stamps whereever this facility is available. When documents is lodged for adjudication,
on receiving intimation as to the amount of Stamp duty payable by tendering appropriate
amount equal to the amount of Stamp duty and penalty if any, the Collector of Stamp
shall certify the document as to the payment of proper duty.
Q. 15. What is the validity of Stamps
As per the provisions of Section 52-B, the
stamps which are purchased and not used within six months shall be rendered invalid
thereafter. The stamps purchased and not used for intended purpose are entitled
for refund after deduction of certain charges, if lodged for refund within six months
from the date of purchase and on fulfilling the conditions stipulated in Chapter
V of the Bombay Stamp Act, 1958.
Q. 16. What are the consequences of
not paying Stamp duty?
The documents if not duly stamped, shall not be admissible
in evidence in the court of law. As per the provision of Section 59, any person
who, with the intention to evade the Stamp duty, executes or signs any instruments
chargeable with stamp duty, without the same being duly stamped, shall on conviction,
be punished with rigorous imprisonment for � term which shall not be less than one
month but which may be extended upto six months and fine upto Rs. Five Thousand.
The Section 67 and 68 empowers the authorities to enter upon any premises and to
inspect and impound/seize the documents which are not duly stamped and burden is
casted upon every public officer to assist the authorities in detection of evasion.
The documents impounded for want of proper duty, attracts penalty @ 2 % per month
from the date of execution of such document.Miscellaneous
Q. 17. In whose name the stamps are
required to be purchased ?
The stamps are required to be purchased in the name of one of executors to the instrument.
Q. 18. What happens if the instrument
is executed on stamps which does not bear the name of one of the executors.?
Such instruments are not admitted in evidence,
for any purpose. These instruments are also treated as not properly stamped. These
instruments are liable to be impounded and sent to the Collector of Stamps for recovery
of proper stamp duty.
Q. 19. What are the rates of Stamp
duty on instruments relating to transfer of immovable property.
The rates of stamp duty on instruments relating to transfer
of immovable property vary from place to place. The rates are specified in Article
25 of Schedule 1 appended to the Bombay Stamp Act, 1958. However, Article 25(d)
which deals with the instruments of transfer of residential premises in � Co-operative
Housing Society or where the provisions of Maharashtra Ownership Flats Act 1963
and the Maharashtra Apartment Ownership Act, 1970 apply, provides for levy of concessional
rates of Stamp duty. In areas, where the provisions of the aforesaid Acts apply,
residential premises upto � market value of Rs. 1,00,000/- attract such concessional
rates. Instruments relating to the transfer of residential premises of market value
of more than Rs. 1,00,000/- attract normal rates of stamp duty for values over and
above Rs. 1,00,000/- as applicable in that area. Such normal rates are 8 %, 6%,
3 %, 5 %. Etc. depending on where the property is situated.
Q. 20. Whether any penalty is levied
in cases referred to the Collector by the Sub-Registrar for determination of true
market value of the property where the Collector comes to the conclusion that the
true market value of the property was not stated in the instrument ?
In addition to recovery of deficit Stamp duty
in such cases, the concerned party is required to pay penalty of Rs. 250/- plus
15 % interest for each year or part of the year on the deficit amount from the date
of presentation of instrument before the Sub-Registrar.
Q. 21. What remedy is available to
the parties, in case they do not agree with the true market value of the property
as determined by Collector of the District ?
The parties can go in appeal to the Chief Controlling
Revenue Authority, Maharashtra State, Pune. under section 32 B of Bombay Stamp Act,
Q. 22. Is the chargeability of stamp
duty determined by the Collector of stamps in adjudication final ? Can � person
go in an appeal against the order passed by the Collector of Stamps ? Is there any
time limit for filing the appeal ?
The chargeability of stamp duty on the instrument
as determined by the Collector of Stamps is not final. The person affected by the
order of the Collector of Stamps can go in appeal to the Chief Controlling Revenue
Authority, Maharashtra State, Pune as provided in section 53 of the Bombay Stamp
Act, 1958, limit prescribed for the filing of an appeal is within 60 days.
Q. 23. Why do the authorities insist
on disclosure of relevant facts and circumstances to be fully and truly set forth
in the instrument ?
Section 28 of the Bombay Stamp Act, 1958 casts
the duty on the executants to disclose and truly set forth relevant facts and circumstances
in the instruments. This helps in finding out the types of transactions involved
in the instruments which in turn helps in the determination of proper stamp duty
payable on such instruments. Duty is not payable on the title or the heading given
on the top of the instrument but on the recitals as stated in the instruments.
Q. 24. Can there be refund of Stamp
duty in case if the Stamp paper is unused or multiliated?
Yes, Refund can be claimed v/s 47 of The Bombay Stamp
Act 1958. However such claim can be made to the collector of Stampswithin a period
of 6 months from the date of purchase of Stamps
Q. 25. What is meant by impounding
of instruments ?
Every person having by law or consent of parties
authority to receive evidence and every person in charge of � public office before
whom any instrument chargeable with stamp duty is produced or comes in the performance
of his functions. Shall if it appears to him that instrument is not duly stamped,
impound the same, irrespective whether the instrument is not valid in law. Such
impounded document is required to be forwarded to the Collector of Stamps for recovery
of deficit stamp duty in addition to penalty at the rate of 2 % per month .
Q. 26. As the cost of flat is required
to be paid in installment as per agreement whether the stamp duty can be recovered
in part at the time of payment of such installments instead of making full payment
at the time of entering into the agreement ?
No. Stamp duty cannot be paid in settlements,
Various chambers Associations have made suggestions and representations to the stamp
authorities in this regard. However till date no effort is made by the Stamp authorities
towards implementation of the same.
Q. 27. In case where the builder sells
� flat to an individual in � building where the society is not formed and the document
is not stamped and the individual resells the flat to another persons who pays the
stamp duty. The builder confirms the said agreement and thereafter the society is
formed. The purchaser becomes � member of � society. Whether the original purchaser
in future will be liable to pay stamp duty and whether stamp duty can be charged
on the flat and whether the first purchaser can be forced to pay the stamp duty
by the Government or it will be have to be borne by the second purchaser again who
is the present owner of the flat. ?
The original purchaser will be liable to pay
stamp duty on the fair market value prevalent at the date of the document as determined
by the Stamp authorities as stamp duty is paid on each transaction. However, the
reply is subject to the confirmation of the Hon�ble Supreme court of India. In the
question under consideration in my opinion person is responsible to pay stamp duty
on only his own purchase transaction and hence the second purchase in my opinion
will not be liable to pay the unpaid stamp duty of the first purchaser.
Q. 28. On what basis ( Carpet, Built-up
or Super built-up ) are the rates fixed by the stamp authorities ?
For the purpose of determination of True Market
Value, the Built-up area is taken into account.
Q. 29. Will stamp duty have to be
paid if there is a �deed of family settlement and a flat is transferred amongst
family members ?
Yes. As per the provisions of Bombay Stamp
Act, Stamp duty will have to be paid on a deed of family settlement.
Q. 30. Will stamp duty have to be
paid if the flat is gifted by a donor ?
Yes. Stamp duty will have to be paid if the
flat is gifted by the donor.
Q. 31. Is the decree of final order
of a civil court by which immovable property is transferred be liable to be stamped
as a conveyance ?
Yes, After the amendment of Article 25 of the
Bombay Stamp Act. The definition of conveyance has been widened, in view of the
amendment decree or final order of the court by which immovable property is transferred
is liable to be stamped as a conveyance.
Q. 32. In case of resale of the flat
who has to pay the Stamp duty, the purchaser or the seller ?
The parties can themselves decide who shall
pay the stamp duty. If nothing is mentioned in the agreement then as per section
30 of the Bombay Stamp Act, 1958 if the transaction relates to resale of flats then
the stamp duty will have to be paid by the purchase.
Q. 33. Are orders made by the High
court under section 394 of the Companies Act, 1956 in respect of amalgamation of
companies be liable for payment of stamp duty as on a Conveyance ?
Yes, after the amendment made in 1993, the
preview of Article 25(d) has been widened so as to bring orders made by the High
Court under section 394 of the Companies Act, 1956. In respect of amalgamation of
companies. Therefore stamp duty as on a Conveyance will have to be paid on such
Q. 34. In whose name should the stamp
paper be purchased. ? Can the client execute the document on � stamp paper purchased
by an Advocate ?
As per section 34 of the Bombay Stamp Act,
1958 the stamp papers should be in the name of one of the parties who has signed
the documents. Therefore the stamp paper should be purchased in the name of one
of the parties who would be signing the instruments. If the stamp paper has been
purchased in the name of an Advocate, C.A., etc than such instrument shall be treated
as an instrument not duly stamped and shall be inadmissible in evidence.
Q. 35. What are the different types
As of today there are 62 kinds of documents
each one signifying a separate kind of deed. These are as follows: (numbers in italics
indicate the serial no. of support documents required from the support document
list furnished below; absence of number indicates that no support documents are
2. Administration Bond
3. Adoption Deed
5. Memorandum of an Agreement.
6. Agreement relating to deposit of Title deeds, pawn, pledge or hypothecation
7. Appointment in execution of power
8. Appriasal or Valuation
9. Apprenticeship Deed
10. Articles of Association of a company
11. Articles of clerkship
14. Bottomory Bond
16. Certificate of sale
17. Certificate or other document
18. Charter Party
19. Clearance List (purchase or sale of Government Securities)
20. Clearance List (purchase or sale of cotton)
21. Clearance List (purchase or sale of bullion)
22. Clearance List (purchase or sale of oil seeds)
23. Clearance List (purchase or sale of yarn)
24. Composition Deed
25. Conveyance ( 1,2,3,4,5,6)
26. Copy or Extract
27. Counterpart or Duplicate
28. Customs Bond or Excise Bond.
29. Delivery Order
31. Entry or memorandum of marriage.
32. Exchange of property (1,2,3,4,5,6)
33. Further charge
34. Gift (1,2,3,4,5,6)
35. Indemnity Bond
36. Lease (1,2,3,4,5,6)
37. Letter of allotment of shares
38. Letter of license
39. Memorandum of association of a company
40. Mortgage Deed (1,2,3,5,6)
41. Mortgage of crop
42. Notarial Act
43. Note or Memorandum
44. Note of protest by master of ship
45. Order for the payment of money
46. Partition (4,5,6)
48. Power of Attorney
49. Protest of Bill or Note
50. Protest of the master of ship
51. Reconveyance of mortgaged property
52. Release (1,2,3,4,5,6)
53. Respondentia Bond
54. Security Bond or Mortgage Deed (1,2,3,5,6)
55. Settlement (1,2,3,4,5,6)
56. Share Warrants
57. Shipping Order
58. Surrender of Lease (1,2,3,4,5,6)
59. Transfer (1,2,3,4,5,6)
60. Transfer of Lease (1,2,3,4,5,6)
61. Trust (1,2,3,4,5,6)
62. Warrant of goods.
Documents can also be classified as Testamentary and Non Testamentary depending
upon the time when they come into force. E.g. Will is of testamentary type because
it doesn�t come into force immediately whereas a sale deed is a non-testamentary
document since it has immediate effect.On the same lines, some documents have to
be compulsorily registered e.g. a sale or lease deed while registration for some
is optional e.g. affidavit.
Q. 36. What are the different support
documents generally required to be submitted for registration?
For registration purpose, some of the above
documents should be accompanied by one or more support documents. The list of support
documents is as follows:
1. Income Tax clearance certificate under 230 A-1 (ITC) Act 1961.
2. Income Tax certificate 269 UL (37I) Act 1961.
3. Permission under Urban Land Ceiling Act 1976 , section 26.
4. Bombay Stamp Act 1958, section 32 A.
5. Bombay Stamp Act 1958, section 33.
6. Registration Act 1908 sections 25 and 34.