Share transfer

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penal jain (Querist)

25 October 2013 In a private limited company, they transfer 50000 nos of equity share @ Rs. 10/- each Total consideration Rs. 500,000/-. Share transfer from a relative of director to another director. How much stamp duty they have to pay?

Ajay Mishra

Ajay Mishra (Expert)

25 October 2013 Hi

You will pay Rs. 1250/- on consideration of Rs. 500000 @ 25 paisa on every Rs. 100.

Ajay Mishra

Ajay Mishra (Expert)

25 October 2013
Determination of valuation of shares for affixing stamps on the transfer deed:

In case shares are not quoted, the value of the shares for the purpose of stamp means the price that the shares would fetch at the time of transfer or consideration agreed, whichever is higher. [Union of India v Kulu Valley Transport Ltd. (1958) 28 Comp Cas 29 (Punj)].

In case if the shares are listed on stock exchange, the valuation will be determined on the basis of the quotations available on the stock exchange on the date of execution of transfer deed or the consideration paid which ever is higher.
However, no transfer duty is applicable for transfer of shares in case of shares are in D-mat form.

Value of share transfer stamps to be affixed on the transfer deed:

Stamp duty for transfer of shares is 25 paise for every Rs. 100 or part thereof of the value of shares as per Notification No. SO 130(E), dated 28-01-2004 issued by the Ministry of Finance, Department of Revenue, New Delhi.