19 June 2010
the rate of stamp duty for debentures is provided in Article 27 of First Schedule of the Stamp Act, which provides as follows:
27. Debenture (Whether a mortgage debenture or not), being a marketable security transferable
(a) by endorsement or by a separate instrument of transfer
(b) by delivery
0.05% per year of the face value of the debenture, subject to the maximum of 0.25% or rupees twenty-five lakhs whichever is lower.
Please note if the debentures so issued are not “marketable security” under the Stamp Act then the aforementioned duty shall not be applicable. For the debentures not to be considered as marketable security, the terms of issue of debentures must provide for restriction on transferability of such debentures.
Further, the stamp duty on debentures is a central subject and would not vary with the registered office or place of holding of the board meeting.