Reviewed by Aug 27, 2020| Updated on
Stamp duty is a tax imposed on the sale of property/property ownership by the state government. It is payable under Section 3 of the Indian Stamp Act, 1899.
The duration of the stamp duty at the time of registration shall be based on the value of the house/property. It also varies based on the state or area where the property is located, and whether it is a new or old house.
Stamp duty will be an additional cost you incur when you set out to purchase immovable property, and it is, therefore, essential to understanding the consequences for the nature and location of the house you intend to buy.
Payment of Stamp Duty
The payment of stamp duty must be rendered in full. The collection of the stamp duty must be completed on time, or it will incur fines. It is a legal document which can be used in court as evidence and has meaning.
Payment of the obligation shall be made before the legal document is executed, at the time of execution, or within one working day afterwards. The payment typically is made by the property's buyer. In the case of an exchange of goods, both the buyer and the seller shall be liable to pay stamp duty equally.
The penalty for insufficient payment of the stamp duty will be levied at 2% per month and up to a maximum of 200% on the amount to be paid.
Points to Note
In the case of lack of essential information, the valuation officer might recall the document.
Details, such as the house location, year of building, number of floors, etc. are to be specified to complete the stamp duty process quickly.
Stamp duty is payable on the sale of all real estate except those sold by Will.
When the applicant eventually transfers the property to a legitimate successor, such a transfer must be made according to market value.
The parties to the agreement are also required to submit all necessary documents for stamp duty. Those documents include transfer instruments, partitioning deed, mortgage conveyance, mortgage deed, selling certificates, gift deed, tenancy agreement, license agreement, lease deeds, etc.