Types of stamps & Concepts of stamp duty, How to pay the Stamp Duty?. In this article you can find complete details regarding Stam Duty like - Some Definitions and concepts of Stamp Duty, Various Types of Stamp, Some new stamps which are released in 2015, Charging of Duty, How to pay the Stamp Duty?, Case Laws etc. Stamp duty means a tax payable on certain legal documents specified by statute; the duty may be fixed or ad valorem, meaning that
- the tax paid as a stamp duty may be a fixed amount or
- an amount which varies based on the value of the products, services or property on which it is levied.
- Stamp duties on documents specified in Entry 91 of the Union List -(viz. Bills of Exchange, cheques, promissory notes, bills of lading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts)
- - are levied by the Union.
- Under Article 268, the State in which the Stamp duty is collected retains the proceeds, except in the case of Union Territories in which case the proceeds form part of the Consolidated Fund of India
Types of stamps and some concepts of stamp duty
Instrument V/s DocumentDocument: It is one which is written, presented or recorded statement or condition agreed as per the parties involved which may be evidentially used Instrument: As per Sec 2(14), it is document by which any right or liability, is, or purported to be created, transferred, limited, extended, extinguished or recorded.
Types of Stamp
A. Impressed Stamps
- Labels affixed and impressed by proper officer
- Stamps embossed or engraved on stamp paper (done by government printing press)
- Impressions by franking machines generally done by the bank by depositing the necessary amount of stamp duty with the banks. This kind of stamping is mostly preferred on instruments (other than commercial instruments) as at times it becomes difficult to obtain stamps embossed on stamp paper of a higher value
B. Adhesive StampsThese stamps are those which are to be stuck on the instrument.
Non Postal Stamps: They are of many types-
Some new stamps which are released in 20151. Swachh Bharat : Release of a set of these stamps and a miniature sheet on the theme Swachh Bharat is a part of an effort to achieve the vision of Clean and Healthy India.
Charging of Duty:
- Bonds, debentures or other securities which are issued as a loan are chargeable to duty of 1% on total amount of bonds, debentures or debentures issued. Such duty will not be chargeable on further renewal of loan. These bonds, debentures or securities need not be stamped.
- If any instrument (not being a promissory note) or bill of exchange, is given as security, - for money advanced or to be advanced by way of loan, or for an existing or future debt, - or redeems a duly stamped transfer, intended as a security, it shall be chargeable with duty as if it were an agreement or memorandum of an agreement chargeable with duty.
How to pay the Stamp Duty?
|TYPE OF INSTRUMENT||TYPE OF STAMPS REQUIRED TO PAY STAMP DUTY|
|For each kind of instrument||the description of stamps which may be used will denote stamp duty paid.|
|For instrument stamped with impressed stamps||the numbers of stamps which may be used will denote the stamp duty paid.|
|in the case of bills of exchange or promissory notes written in any Original Language||the size of the paper on which they are written.|
- When there is temporary shortage of stamps in the district or
- if stamps of required denominations are not available,
Some points for stamps:
- Impressed stamp may appear on face of instrument written on paper and cannot be used for or applied to any other instrument.
- Only one stamp is to be affixed on a single instrument, not more than one.
Allowances for Spoiled Stamps
- by error in writing or any other means,
- document on which is written but not signed,
- promissory note which has not been used in any manner,
- bills of exchange signed but not accepted,
- instrument executed which later became void
- The certificate of Collector u/s 32 is to be obtained to claim allowance.
Case Law:This is case of Munsif of Ghaziabad. His case is as follows:
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