Stamp Duty on Agreement for Sale prior to 10-12-1985 is Rs. 5 only

By Santosh Kumar & Sunit Gupta

By Accommodation Times News Services

After the announcement of the Stamp Duty Amnesty 2008, there are some consultants and self designated specialists who are misguiding the people b strongly advising that full stamp duty will be charged on agreement for sale even prior to 10-12-1985. Not only that they are stressing that even the registered document will also attract stamp duty. Failing which 10 times the stamp duty amount will be levied as penalty at the time of conveyance. Most of the people are very much confused because at Stamp duty office they are not accepting documents prior to 10-12-1985 contrary to advise given by the consultants. Please note there is no denying the benefit of amnesty, because all such documents are duly stamped, hence they do not need further stamping, as such the benefit of amnesty does not arise.
Our office has been receiving several telephonic clarifications, since we are the publishers of the Ready Reckoner’s for all earlier years. To clarify this doubt GLOBUS spoke to Santosh Kumar, senior estate valuer and co-author of the Stamp Duty Ready Reckoner and Market Value of Flats in Mumbai / Thane, who clarifies the doubt as under.

www.sevagiri.com

The stamp duty on agreement for sale prior to 10-12-1985 is Rs. 5 only and no more stamp duty will be charged on all such documents. This point was also clarified by Dr Nitin Kareer, I.G.R. Maharashtra, during a public meeting held on 11-4-2004 at K.C. College, Mumbai. In this connection Law and Judiciary Department of the Government of Maharashtra, has also issued a clarification on 24-1-1995, the same is reproduced on backside, which is self explanatory. In view of this clarification all such documents can be annexed with the deed of confirmation on Rs. 100 stamp paper only and the deed of confirmation will be registered annexed with agreement for sale on Rs. 5 Stamp paper. There are several such documents already registered by the sub-registrar of assurance Mumbai, that can be inspected under the Right to Information Act. In case of difficulty one should not hesitate to contact I.G.R. Maharashtra, Pune.
The agreements for sale prior to 10-12-1985 are classified in two groups. One that is registered and another one not registered. As such these agreements will be treated differently at the time of conveyance in favor of the society. Here it is necessary to clarify that stamp duty was applicable even prior to 10-12-1985, but there was an option for payment at the time conveyance. However, for conveyance executed up-to 16-3-1988, residential flat up-to 650 sq ft carpet area was fully exempted from stamp duty and area up-to 1000 Sq ft was exempted up-to 60% of the stamp duty. Because of this provision there is a general notion that there was no stamp duty prior to 10-12-1985.

Now at the time of conveyance, stamp duty liability of all the present members must be cleared. For the liability of registered agreement on Rs. 5 Stamp paper, prior to 10-12-85, the market value (not agreement value) as on the date of agreement will be considered, as purchase price agreement value only, because market value concept was not there at that time. The document which is not registered will be valued as per present market value, subject to depreciation, and stamp duty will be charged, in all the cases, as applicable today.

Regarding Stamp Duty on documents executed on 10-12-1985 and there after, all such documents must be registered after paying the stamp duty, failing which penalty at the rate of two times (not 10 times) of the deficit stamp duty will be charged. During amnesty this penalty is maximum Rs. 1000 only. At the time of conveyance they will not be required to pay any duty again, against their respective flats.
Comparative chart of stamp duty liability on agreement dated 1981 is as per Table-B.
From this example it is clear that if the document is registered, stamp duty will be Rs. 2,200 only against Rs. 1,29,000 for non registered document.

The Amnesty has come primarily to facilitate deemed conveyance of the Co-operative Housing Society, for which it is necessary that all the members of the society must clear the Stamp Duty liability of their respective agreements. Since there are many members who have not paid their share of Stamp Duty, this is an opportunity to clear the same at a normal penalty for everlasting peace.