22 November 2014
sir, we are carrying on business on partner ship firm consisting of 4 partners at equal share of 25% each and we registered at register of firms.we are located in andhra pradesh. now one partner is retiring and we make altered partner ship deed. we went to register of firms to registe the change. the register asking for 5% stamp duty on all property of firm as per market value.for valuation he is not allowing bank loans.
is there any case to pay stamp duty and how do we calculate market value of firm.please clarify.very urgent
19 July 2024
In Andhra Pradesh, when there is a change in partnership due to retirement or any other reason, the registration of the altered partnership deed may attract stamp duty. Here are the key points to consider:
### Stamp Duty on Partnership Deed in Andhra Pradesh:
1. **Stamp Duty Requirement:** - As per the Indian Stamp Act, 1899, states have the authority to levy stamp duty on documents. In Andhra Pradesh, a partnership deed is subject to stamp duty. - The stamp duty is usually calculated based on the market value of the property owned by the firm.
2. **Valuation for Stamp Duty:** - **Market Value:** The stamp duty is typically calculated on the market value of the property of the partnership firm. This includes assets such as land, building, machinery, and any other property owned by the firm. - **Bank Loan Valuation:** While banks may provide valuation for loan purposes, they might not be accepted for stamp duty purposes. Instead, a registered valuer's assessment might be required for stamp duty purposes.
3. **Calculation of Stamp Duty:** - Stamp duty rates can vary depending on the nature of the property and the location within Andhra Pradesh. Generally, it is advisable to consult with a local stamp duty expert or a registered valuer to determine the exact market value and applicable stamp duty rate. - Stamp duty rates for partnership deeds are applied to the total value of the partnership assets or as determined by the Registrar of Firms.
### Steps to Proceed:
- **Consult a Registered Valuer:** Engage a registered valuer to assess the market value of all partnership assets. They will provide a valuation report that can be used for stamp duty calculation. - **Document Preparation:** Prepare the altered partnership deed with the details of the retiring partner and their settlement, if any, as per the partnership agreement. - **Stamp Duty Payment:** Pay the stamp duty as assessed by the valuer and register the altered partnership deed with the Registrar of Firms.
### Conclusion:
Given the specific requirement for stamp duty on partnership deeds in Andhra Pradesh, it's crucial to follow the local regulations and ensure compliance. Seek assistance from a stamp duty expert or a registered valuer to accurately determine the market value of the partnership assets and calculate the applicable stamp duty. This will help in smoothly registering the altered partnership deed with the Registrar of Firms.
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