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1. What
is the extent of application of the Bombay Stamp Act, 1958?
The Act applies to the whole of the State of Maharashtra.
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2. What is an "Instrument"
under the Act?
"'Instrument' includes every document
by which any right or liability is or purports to he created,
transferred, limited, extended, extinguished or recorded, but
does not include a bill of exchange, cheque, promissory note,
bill of lading, letter of credit, policy of insurance, transfer
of share, debenture, proxy and receipt." |
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3. What is market
value?
Market value in relation to any property which is the subject
matter of an instrument means the price which such property
would have fetched if sold in the open market on the date
of execution of such instrument or the consideration mentioned
in the instrument, whichever is higher. The price which such
property would have fetched if sold in the open market is
determined on the basis of the Ready Reckoner issued each
year. Depreciation in stamp duty is available for old buildings
and building without lift. |
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4. When is stamp duty
payable on an instrument in Maharashtra?
All instrument are liable to be stamped before or at the time
of execution of instrument or immediately thereafter on the
next working day following the date of execution, when executed
in the State of Maharashtra. Any instrument executed outside
the state is liable to duty only on receipt of such instrument
in the state, provided it relates to a property situated in
the state, or a matter or thing to be done in the state. Stamp
duty is not levied on a transaction, but on an instrument. |
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5. What is the rate at
which stamp duty is payable?
Stamp duty is payable at the rate mentioned in Amendment Act,
2004 of the Bombay Stamp Act, 1958. |
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6. Which documents are
required to be compulsorily registered?
Documents listed in Section 17 of the Indian Registration Act,
1908 are to be registered compulsorily. Registration of documents
listed in Section 18 of the Indian Registration Act, 1908 is
optional. An agreement for leave and licence is required to
be compulsorily registered under the Maharashtra Rent Control
Act, 1999. |
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7. Is there a time limit
within which documents should be registered?
Yes. Documents must be registered within 4 months of the date
of execution. Thereafter, documents can be registered within
the next 4 months on payment of penalty. |
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8. Who is required to
pay stamp duty and registration fee on purchase or lease of
a flat or office?
A purchaser (whether on first sale from a developer or on resale
of a flat) or a lessee of a flat or office is required to pay
stamp duty and registration fee. |
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9. How is stamp duty
paid in Maharashtra?
Stamp duty above the value of Rs. 25,000 is payable by a pay
order/ demand draft/cheque drawn in favour of "The Superintendent
of Stamps, Mumbai". Alternatively, a pay order can be drawn
in favour of "The Reserve Bank of India- A/c Stamp Duty, Mumbai".
The original instrument is then franked with the value of the
stamp duty. Adhesive stamps are no longer used in Mumbai city.
Stamp Duty upto the value of Rs.25,000 can be paid in cash.
A receipt is issued by the concerned office for the stamp duty
amount. |
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10. What is the procedure
for registration of an instrument?
Once adequate stamp duty is affixed on an instrument and it
is dated, signed by the parties and attested (where required)
by witnesses, it can be lodged for registration after payment
of the registration fee. All parties signing the instrument
are required to attend the office of the concerned Sub Registrar
of Assurances either by themselves or through their constituted
attorney under a power of attorney to admit execution of the
instrument.
A passport size photograph, original power of attorney, personal
identification such as passport or income tax PAN Card, adequate
xerox copies of the original instrument are some of the essentials
required for registration.
After lodging an instrument, it is registered and seal of the
Sub Registrar is affixed on the instrument, thereafter the original
instrument is returned back to the parties. |
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11. Is there a restriction
on the name in which stamp paper must be purchased?
Yes. Therefore the stamp paper should be purchased in the name
of one of the parties who would be signing the instrument. |
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12. Is there a time frame
within which the stamp paper must be used?
Yes. Stamp paper should be used within 6 months from date of
purchase. Any stamps not used within this period are invalid. |
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13. Is there a penalty
for not paying the requisite stamp duty? Yes. Previously
the penalty was an amount not exceeding 10 times the amount
of the proper duty. As per the recent amendments, penalty of
2% per month on the proper duty for the period of default will
be levied, subject to a maximum of 2 times the deficient portion
of duty. Instruments are liable to be impounded till proper
stamp duty is paid. |
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14. What are the consequences
for not paying stamp duty on an instrument?
In case proper stamp duty is not paid on an instrument, the
instrument is inadmissible as evidence. |
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15. Is it possible to
get a refund of stamp duty already paid on an instrument?
Yes. If stamp duty is paid on an instrument but the instrument
is not signed by any party then an application is to be made
within 6 months of the date of purchase of the stamp paper,
to the concerned authorities for refund of stamp duty. The original
stamp paper is returned alongwith the application. On receipt
of such application, the concerned authorities are empowered
to refund the value of stamp duty after deducting such amounts
as may prescribed. |
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16. Is stamp duty payable
on a gift or resale of a flat?
Yes. Stamp duty is payable on instrument of gift or resale of
a flat. |
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17. When can an instrument
be impounded?
When an instrument is presented for registration and the concerned
authorities have reasons to believe that an instrument does
not reflect the true market value and they can take steps for
recovery of the stamp duty including impounding of instruments.
If the collector determines that the proper stamp duty has not
been paid then penalty can be levied on such instruments. |
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18. Is there a procedure
for adjudication of stamp duty?
A person can seek the opinion of the Collector of Stamps by
making an application to him for adjudication of stamp duty
payable by such person on the instrument. For this purpose,
the person who is a party to the instrument has to furnish a
true copy of the instrument and an affidavit stating the facts
and such other evidences as required, along with prescribed
fee. The Collector's opinion is final and conclusive. No appeal
lies against his order of adjudication. |
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19. Can a person grant
a power of attorney for signing and registering instrument?
Yes. Persons residing abroad or those who travel frequently
are advised to grant power of attorneys to facilitate better
management of their flats. |
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20. Can a person grant
a power of attorney for registering instruments? Yes, but
his power of attorney must be registered before the Sub Registrar
of Assurances. |
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21. Is an agreement for
sale of a flat /shop/office required to be stamped and registered?
Yes. An agreement for sale of a flat /shop/office is required
to be stamped and registered as per prevalent law. |
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Stamp Duty In The State Of Maharshtra |
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