LECTURE

ON
INDIAN STAMP ACT - 1899

BY

B.A. PRABUSHANKAR, B.A.B.L., DLAL., M.L.,M.Phil,PG

Dip.crl& F.Sc.,
LAWYER,
bapslawoffice@gmail.com
bapslegalegal@gmail.com
 OBJECTIVE
• It is an act to consolidate rules relating to
regulation of Stamps & with regard to
regulation of duties chargeable upon
various instruments executed between the
parties.
• Execution of instruments may be in course
of transfer of an immovable property
• With regard to sale of moveable properties
 OBJECTIVE
• With regard to creating a charge over the
property
• Creation of a charge may be by means of
hypothecation
• Hire purchase
• By means of offering collateral security
• By way of mortgage
FURTHER INSTANCES WHEREIN
STAMP DUTY IMPOSED
• In case of discharge of a liability
• In case of borrowings based upon pronotes
• And other sorts of instruments
• In case of offering guarantees
• In case of execution of settelement deeds
• Partition deeds
• Family arrangements
• Partnership agreements
FURTHER INSTANCES WHEREIN
STAMP DUTY IMPOSED
• Execution of power of attorneys
• And, such other agreements in order to
create a legal binding between the parties.
 PURPOSE OF STAMPING
• The purpose of stamping is to see that by means
of imposing certain stamp duties, the revenue is
collected to the government
• Documents all which requires registration under
the registration act has to be mandatorily and
accordingly has to be stamped as per the
provisions of this act.
• Further, registration of a document makes
Execution of documents makes more
authenticate
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• As far as the indian stamp act is
concerned, it is been divided into 8
chapters
• Indian stamp act consists of a schedule
called SCHEDULE – I
• SCHEDULE-I to the indian stamp act
describes the various stamp duties
payable on various kinds of instruments.
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Further, it deals with instruments
chargeable with stamp duty
• All instruments detailed in the schedule
are chargeable with duty as indicated
• Several instruments used in similar
transaction such as sale, mortgage,
settlement.
• Instruments such as policies of sea
insurance, bonds, debentures (or) other
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Securities
• Further, it also deals with the powers of
officers vested under the act with regard to
reduction, remittance, and compounding of
duties
• Further, deals with the various types of
stamps and mode of using them
• Further deals with various modes of
payments of duties
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Use of adhesive stamps
• In cases of instruments chargeable with duty not
exceeding 25 paise
• Bills of exchange and pronotes drawn or made
in india
• Entry as an advocate, vakil or attorney on the
role of high court
• Notarial acts and
• For purpose of transfer of shares of any
company of other body corporate.
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Cancellation of adhesive stamps is
provided under section 12 of the act which
says that any person who affixes any
adhesive stamp to any instrument
chargeable with duty shall cancel the
same while execution to the effect that it
cannot be reused again.
• Any person who does not cancel this
stamp so that it can be used again such
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Instrument will be deemed to be
unstamped.
• Instruments stamped with impressed
stamps how to be written on the face of
the paper
• Further, Indian stamp act also says that
only one instrument can be written on
same stamp, no second instrument charge
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Able duty shall be written upon a piece of stamp
paper upon which already an instrument
chargeable with duty is writtened
• All instruments executed in india shall be
stamped before or at the time of execution
• Further, every instrument executed outside india
and not being a bill of exchange or promissery
note may be stamped within 3 months after it
has been received in india.
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Also deals with payment of duties on copies or
counterparts when the duties has not been paid
on the original instruments
• Deems with conversion of amounts
• Expressed in foreign currencies
• Speaks about ad-valorem duties.
• Deals with stocks and marketable securities with
regard to duty calculation according to the value
or price thereon on the date of instrument.
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Deals with transfer of property subjected to
mortgage when it is transferred to mortgage, he
shall be entitled to deduct from the duty payable
on the transfer, the amount already paid in
respect of mortgage
• Deals with valuation of annuity, etc.,
• Deals with stamp duty where the subject matter
is in-determinate
• In such cases, nothing shall be claimable under
such instrument more than the highest amount
or value as stated in the instrument.
 STAMP ACT AND ITS
OPERATIONS – A GLANCE
• Further the indian stamps act deals
affecting delas fact affecting stamp duty to
be set forth in the instrument
• The consideration, market value and other
facts and circumstances affecting the
chargeability of an instrument with duty
shall be set forth.
 STAMP DUTY BY WHOM
PAYABLE
• In case of administration bond,
• Agreement relating to deposit of title
deeds
• Pawn or pledge,
• Bill of exchange
• Bond or bottomry bond
• Custom bonds
 STAMP DUTY BY WHOM
PAYABLE
• Debentrues
• Further charge

• Indemnity bond

• Mortgage deed
 STAMP DUTY BY WHOM
PAYABLE
• Promissory note

• Release deeds

• Security bonds

• Settlement

• Transfer of shares
 STAMP DUTY BY WHOM
PAYABLE
• Transfer of debentures
• Policy of insurance and in the above
instances, the stamp duty shall be paid
• by the person
• Drawing, making or executing such
instrument.
• In case of policy of insurance – other than
fire insurance – by the person effecting the
insurance
 STAMP DUTY BY WHOM
PAYABLE
• In case of fire insurance – by the person issuing
the policy
• In case of conveyance, or lease by the grantee
or leasee
• In case of instrument of exchange, by parties in
equal shares
• In case of certificate of sale, by the purchaser
• In case of an instrument of partition, by the
parties in proportion to their shares
 OBLIGATION TO GIVE RECEIPT

• Any person receiving any money,

exceeding Rs.20.00 in cash (or) by way of
bill of exchange, cheque or promissory
note for amount exceeding Rs.20/- or
receiving any property in satisfaction of
debt
• On demand by the person paying, shall
give a duly stamped receipt for the same.
 OTHER ASPECTS OF STAMP
ACT
• It further deals with ad-judication of
stamps
• With regard to certificate by a collector
• With regard to the determination of duty
• Deals with instruments not duly stamped
• Procedures for examination and
impounding instruments not duly stamped
• Deals with recovery of deficit stamp duty
 PURPOSE OF STAMPING – Sec. 35

• No instrument which is chargeable with

stamp duty shall be admitted if it is not
duly stamped as evidence in the court
• Further, un-stamped instruments are all in-
admissible under law.
 FURTHER ASPECTS
• Deals with admission of im-properly
stamped instruments due to ambiguous
descriptions
• Deals with procedures relating to
instruments impounded
• Deals with collectors power to refund
penalty
• Deals with powers of the collector to order
proper stamping of impounded documents
 FURTHER ASPECTS
• Deals with prosecution for offenses
against stamp law
• And other related aspects with regard to
allowances for spoiled stamps
• And other proceedures with regard to
reference and revisions
 CRIMINAL OFFENSES UNDER
THE ACT
• Any person executing instruments not duly
stamped which are duly chargeable with duty
• Voting or attempting to vote under a proxy
• Not duly stamped
• Shall be punishable with fine which may extends
to Rs.500/-.
• In case of a share warrant, issued without being
duly stamped, the issuing company as well as
the persons responsible are liable for
punishment to an extend of Rs.500/-.
 CRIMINAL OFFENSES UNDER
THE ACT
• Further penalty is provided for failure to
cancel adhesive stamps
• Penalty for failure to comply with section
19-B regard to payment of difference of
duty and penalty to act in compliance with
provision of section 27
• Penalty for refusal to give receipt and
devices to evade duty on receipts
 CRIMINAL OFFENSES UNDER
THE ACT
• Penalty for not making out policy without
duly stamping
• Penalty for not making policy duly
stamped
• Penalty for breach of rule relating to sale
of stamp
• And for un-authorized sale.
 OFFENCES TRIABLE
• Any magistrate
• Or presidency magistrate may try any
offense under this act
• Every such offense shall be tried at the
place where it is found out (or) where it
has been attempted to be done.
 KINDS OF STAMPS
• Adhesive stamps
• Impressed stamps
• Judicial stamps
• Non-judicial stamps
• Notorial stamps
 Omissions & Errors
• The said Book is just an insight into the
said Act and the reader is advised to look
for further updates on amendments ,
changes , omissions and errors .