Wednesday, January 29, 2014

Increase in Stamp Duty on Share Certificates and Other Instruments by State of Haryana

Increase in Stamp Duty on Share Certificates and Other Instruments by State of Haryana

The Haryana State Government in order to curb the malpractices adopted by some of the Corporate holding their Board Meetings in Gurgaon or some other places in Haryana and executing the share certificates (i.e. instruments) over there, thereby evading the stamp duty on share certificates, and also finding the stamp duty on a lower side, has amended the Article 19 of Schedule 1A (as applicable to Haryana) of the Indian Stamp Act, 1899 (“Act”) vide notification dated 1st October 2013in exercise of the power under Article 246 (3) read with Entry 63 of List II of Seventh Schedule of Constitution of India, andincreased the stamp duty levied on the share certificates evidencing the right or title of the holder thereof, or any other person, to the shares in such certificates, equivalent to the stamp duty levied on such share certificates in the National Capital Territory of Delhi.

Further a new clause (d) to Article 5 has been inserted according to which the agreement giving power or authority to a promoter or a developer, by whatever name called, for construction on, development or, sale or transfer (in any manner whatsoever) of, any immovable property, shall also attract equivalent Stamp Duty as applicable to conveyance under Article 23 of the Schedule 1-A. In addition the Government has also increased the rate of stamp duty on the instruments issued and falling under Article 27 i.e. issue of Debentures, equivalent to the duty in the National Capital Territory of Delhi and under Article 48 i.e. on the power of attorney given in favour of other person to act on behalf of the first person.

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