The contents of this website and included documents are not intended to be a complete statement of the law on any subject and should not be used as a
substitute for legal advice in specific fact situations. The Registration Department or Government of Telangana cannot accept any liability or responsibility for loss
occurring as a result of anyone acting or refraining from acting in reliance on any material contained in this website.
FREQUENTLY ASKED QUESTIONS ON STAMP DUTY MATTERS
Q1. WHAT IS MEANT BY STAMP DUTY?
Stamp duty is a kind of tax levied on instruments(documents)
Q2. WHAT ARE THE DOCUMENTS ON WHICH CENTRAL GOVERNMENT CAN ONLY PRESCRIBE STAMP DUTY?
duty in respect of the
o Bill of exchange
o Promissory Note
o Bill of landing
o Letter of Credit
o Policy of Insurance
o Transfer of Shares
o Debenture and Receipt..
Q3. WHAT ARE THE DOCUMENTS FOR WHICH STATE GOVERNMENT CAN PRESCRIBE STAMP DUTY?
Other than the above mentioned (question No.2) instruments, on any other instrument, the State legislature can fix the stamp duty. Example: Affidavit, adoption deed, sale deed, gift deed, lease deed, mortgage, license, partition deed and settlement deed etc.
Q4. HOW TO PAY STAMP DUTY AND WHERE IT CAN BE PAID?
Stamp duty can be paid through
a) Purchase of impressed stamps from treasury or licensed stamp vendors or from sub - registrar offices OR
b) Purchase of adhesive stamps OR
c) Payment to the Government through DD / pay order issued by any nationalised bank / scheduled bank or challan OR
d) Instrument (document) can be written on plain paper and stamp duty can be paid through DD / pay order issued by any nationalised bank / scheduled bank or challan within one year from the date of execution of the instrument (document) and get it certified by the jurisdiction District Registrar under Sections 41 and 42 of Indian Stamp Act, 1899. In the year 2003, the Government has introduced the challan system in respect of documents coming for registration. Now, in Telangana the Non-Judicial Stamp papers of Rs.10/-, Rs.20/-, Rs.50/-, Rs.100/- - only are available. So, the people who require to get their document registered, may use these lower denomination NJ Stamp papers, which can be obtained, from Sub Register offices, from Licensed stamp vendors or post-offices.
For example, if an instrument has to be stamped with Rs.10000/ - . The parties may buy 5 NJ Stamp papers of Rs.100/ - value, which means Rs.500/ - stamp duty is paid. Remaining stamp duty of Rs.9500/ - shall be paid through challan. Each Sub Registrar Office, has been tagged with a designated branch of SBH bank. The parties after filling the challan, shall pay the amount through the challan provided by the Sub Registrar. A copy of challan shall be produced before the SR in evidence of the payment of stamp duty. The SR will register the document on the basis of the challan produced before him. A safe mechanism has been in place to check the genuineness of the challans produced by the parties.
Q5. CAN A STAMP PAPER USED FOR ONE PURPOSE BE USED FOR ANOTHER TRANSACTION?
No. A stamp paper once used for a purpose cannot be used for another purpose. Example: An affidavit executed for a purpose cannot be executed for another purpose.
Q6. WHEN STAMP DUTY IS TO BE PAID?
(a) Generally stamp duty shall be paid before or at the time of executing a document.
(b) Instrument (document) can be written on plain paper and stamp duty can be paid through DD / pay order issued by any nationalised bank / scheduled bank or challan within a year from the date of execution of the instrument (document) and it can be got Certified by the jurisdictional
District Registrar with respect to documents which are not coming for registration.
Q7. HOW TO PAY STAMP DUTY IN RESPECT OF A DOCUMENT EXECUTED OUT OF INDIA TO BE USED IN TELANGANA? WHAT IS THE PROCEDURE TO BE FOLLOWED?
Stamp duty can be paid within three months from the date of receipt of such document in India. Document may be produced before the District Registrar, who will endorse the payment under Section 18 of Indian Stamp Act, 1899.
Q8. IS IT MANDATORY TO PAY STAMP DUTY AS PER SCHEDULE -IA OR INDIAN STAMP ACT AS APPLICABLE IN THE STATE OF TELANGANA TO A DOCUMENT RELATING TO PROPERTY SITUATED IN TELANGANA WHICH IS EXECUTED IN OTHER STATES OF INDIA? WHAT IS THE PROCEDURE TO BE FOLLOWED?
When a document is executed on stamp paper purchased in other state and executed in other state but it is in respect of property situated in Telangana, if such duty is less than the duty prescribed under the Indian Stamp Act, the deficit duty shall be paid. Example: A power of attorney is executed in favour of a person other than family member, 1 percent stamp duty on value of the property shall be made good after deducting stamp duty, if any, already paid in that state(subject to change from time to time).
Q9. IS IT MANDATORY TO PAY STAMP DUTY ON INTEREST TO BE ACCRUED ON THE LOAN IN RESPECT OF DOCUMENTS EXECUTED AS A SECURITY FOR SUCH LOAN?
No. Stamp duty is to be paid on loan amount. No duty need be paid on interest to be accrued.
Q10. IS THERE DEDUCTION OF STAMP DUTY IN RESPECT OF SALE DEED RELATING TO PROPERTY EXECUTED IN FAVOUR OF MORTGAGEE OF THE SAME PROPERTY?
Yes. Deduction to the extent of duty paid on mortgage deed is available.
WHAT IS THE STAMP DUTY TO BE PAID IN RESPECT OF INSTRUMENTS IN WHICH AMOUNT IS TO BE PAID IN ANNUITY OR PERIODICALLY?
Ans:-In respect of instruments executed to pay amount annually or periodically , stamp duty is to be paid as follows depending on the circumstances.
Where the sum payable during the period is previously ascertained , stamp duty is to be paid on whole of the amount.
Where the sum payable is in perpetuity or for an indefinite time not terminable with any life, stamp duty shall be on the sum payable during the period of 20 years calculated from the date on which the first payment becomes due.
Where the sum payable for an indefinite time terminable with any life, the stamp duty shall be paid on the sum payable during the period of 12 years calculated from the date on which the first payment becomes due.
GENERALLY THERE ARE TWO PARTIES TO A DOCUMENT I.E. EXECUTING PARTY AND CLAIMING PARTY. WHO IS LIABLE TO PAY STAMP DUTY AMONG THEM?
In the absence of agreement to the contrary, the expense of providing the proper stamp shall be borne-
In the case of mortgage by way of deposit of deed, hypothecation, further charge,
demnity bond, bond, mortgage, settle
by the person drawing making or
executing such instrument;
In case of conveyance (sale etc.) deed including re
conveyance by the grantee,
Example: in case of sale deed purchaser is liable to pay stamp duty.
In case of lease,lessee
In case of power of attorney, executing party
In case of Certificate of sale on auction of property
In case of exchange deed both parties equally.
In case of partition deed, all the parties in proportion to their share are liable to pay
Q13. IS THERE ANY PROVISION TO GET AUTHENTIC OPINION ON THE DUTY PAYABLE ON ANY DOCUMENT WHEN IT IS DOUBTFUL? WHAT IS THE PROCEDURE IF SUCH A PROVISION EXISTS?
In case of any doubt about the duty payable on any instrument (document),application may be made to the District Registrar under Section 31 of Indian Stamp Act, 1899 with following records, along with a fee of Rs.15:
Draft of the proposed deed or deed itself.
Affidavit (on stamp paper of Rs.20)
Q14. WHAT ARE THE CONSEQUENCES OF NON-PAYMENT OF STAMP DUTY?
When Stamp duty leviable on a document is not paid it cannot be accepted or received in evidence. No transaction is valid if done on the basis of instrument not duly stamped. Instruments presented to any public officer (excluding police) will be impounded. Stamp duty and penalty will be levied.
Q15. WHAT IS THE PROCEDURE TO BE FOLLOWED AFTER A DOCUMENT IS IMPOUNDED?
(a) A public officer impounding an instrument will send it to Collector (District Registrar) concerned to determine the stamp duty to be paid.
District Registrar will determine the stamp duty to be paid after giving opportunity to the party concerned to put forth his arguments on the duty to
be paid. He may levy penalty of minimum of Rs.5 or up to ten times of the deficit duty to be paid depending on the case, if he finds the document was
not duly stamped. Appeal can be preferred to the Chief Controlling Revenue Authority (Commissioner and Inspector General of Registration and Stamps,
Andhra Pradesh) in first instance, and then to the High Court if the parties are aggrieved.
IS THERE A PROVISION TO WRITE DOCUMENT ON THE STAMP PAPER AVAILABLE AND PAY DEFICIT DUTY AFTERWARDS IN URGENT SITUATIONS?
Yes there is a provision, if the party concerned voluntarily comes forward to pay deficit stamp duty within one year from the date of execution (signature), District Registrar will accept deficit stamp duty and certify accordingly on the document without levying penalty under Section 41 and 42 of Indian Stamp Act, 1899.
Q17. IS THERE A PROVISION TO GET REFUND OF PENALTY PAID IN CASE OF IMPOUNDED DOCUMENT?
Yes there is a provision. Chief Controlling Revenue Authority (IGR & S) may order refund on appeal, if the penalty levied is found to be on higher side.
Q18. STAMP DUTY IS LEVIED ON MARKET VALUE OF PROPERTY INVOLVED IN SALE, GIFT, EXCHANGE OR SETTLEMENT. HOW TO KNOW THE MARKET VALUE OF PROPERTY?
(a) As defined under Sec.47A of the Indian Stamp Act, 1899, market value of property is the value it would fetch if sold in the open market.
(b) Government has formed Committees to estimate market value of properties. They would survey and enquire regarding values of different localities in open market. They would collect the data from different sources like open auctions conducted by HUDA and other urban development authorities, Banks, Financial Institutions, registered documents reflecting real consideration, land acquisition compensation, etc. The committee will estimate the value from time to time as per laid down norms and principles and publish the same for information of public. The committees after hearing the objections, if any from the public will modify/amend the proposals or if they found the objections are unfounded, then they may go ahead to approve the proposed values. We have urban and rural committees to fix market values. Revenue Department, Municipal, ZillaParishad, Registration Department officials are part of this committee. From the year 2010, the market value guidelines registers are being published and sold through Sub Registrar and District Registrar Offices.
(c) When a document is presented to the Sub Registrar for registration, he will give market value slip in prescribed form about the market value of property. If the party concerned agrees to pay the stamp duty on such value, he will register the document.
(d) If parties to the document do not agree to pay stamp duty on the market value informed as above, the Sub Registrar will keep the document pending and refer the matter for determination of market value after collecting 50% of the deficit stamp duty as a deposit to refer it to the Collector (District Registrar) under Section 47A
(e) District Registrar will hear the parties and determine market value after spot inspection if necessary.
(f) Appeal may be preferred to the Civil Court within 60 days from the date of receipt of order of the District Registrar.
Q19. IS THERE PROVISION TO GET REFUND OF VALUE OF STAMP PAPERS NOT USED OR SPOILED ETC?
Yes, there is a provision to refund of value of NJ Stamp papers not used or spoiled under Indian Stamp Act, 1899. But in the State of Telangana, the NJ Stamp papers are available upto Rs.100/ - denomination only. Therefore, this provision serves no better purpose. But, the Government of issued a G.O., allowing refund of the. amounts paid through challan system. A copy of the G.O., may be seen by clicking here....
Q20. IS THERE ANY TIME LIMIT FOR THE USAGE OF THE STAMP PAPERS PURCHASED?
Ans:-No, there is no SUCH time limit. They may be used anytime
Q21. HOW TO PREVENT USE OF FAKE STAMPS?
In Telangana State, sale of Non - judicial stamp papers is restricted to the denomination maximum of Rs.100/ -. Therefore, in a way, the Government has checked effectively the circulation of fake stamps by sale of the stamps from only authorized/licenced Stamp Vendors or from Government Offices (Sub Registrar and District Registrar Offices)/(postoffices). Remaining stamp duty can be paid through challan.
Q22. WHAT IS THE STAMP DUTY AND RE GISTRATION FEE PAYABLE FOR PARTITION AMONG JOINT FAMILY? ?
0.5% stamp duty to a maximum of Rs.20,000/- on the market value of the value of separated share. Example: If there are three parties by name A,B and C in a partition deed, Party by name A got Rs.500000/ - value of property. Party B got Rs.400000/ - and Party C got Rs.300000/ - . Now, the parties have to pay the stamp duty on the value of separate share means on Rs.4 and 3 lakhs exempting Rs.5 lakh. A stamp duty of Rs.3,500/ - has to be paid on this instrument of partition. In case all the shares are of equal value, then one share has to be exempted from calculation to levy stamp duty.