Stamp duty for issue of share certificates
This query is : Resolved
09 March 2009
Dear All,
Is there is any stamp duty to issue an share certificate of an Pvt ltd company to an share holder...if yes, what is the percentage of duty and what is the procedure after filiing of Form 2...
Is there is any stamp duty to issue an share certificate of an Pvt ltd company to an share holder...if yes, what is the percentage of duty and what is the procedure after filiing of Form 2...
09 March 2009
Yes you have to pay stamp duty. Percentage differs from state to state. You have to approach your jurisdictional sub-registrar and should find out the percentage.
09 March 2009
Company is Situated in bangalore so what is the Percentage of Stamp Duty, is it 0.01% including the premiem and what is the procedure to get stamped to share certificates.
25 July 2025
Yes, **stamp duty is applicable** on the **issue of share certificates** even for a **private limited company** in **Bangalore, Karnataka**.
---
### ✅ **Stamp Duty Rate in Karnataka (on issue of share certificates)**:
As per the **Karnataka Stamp Act, 1957**, under **Article 16**, the rate is:
> 🏷️ **₹1 for every ₹1,000 or part thereof** of the value of shares (including premium, if any).
So, for example:
* If you issue shares worth ₹1,00,000 (including premium), stamp duty = ₹100
* If you issue shares worth ₹1,00,500 → stamp duty = ₹101
---
### 📄 **Procedure for Payment of Stamp Duty in Karnataka**:
#### Step 1: **Calculation**
* Calculate the total value of shares (face value + premium, if any).
* Compute stamp duty at ₹1 per ₹1,000.
#### Step 2: **Mode of Payment**
* **Stamp duty on physical share certificates** is paid by:
* **Affixing adhesive stamps** (not postal stamps), or
* **Paying through e-Stamping** (recommended and accepted by Karnataka government via SHCIL).
#### Step 3: **e-Stamping Process (Karnataka)**
* Visit the SHCIL (Stock Holding Corporation of India Ltd.) website: [https://www.shcilestamp.com](https://www.shcilestamp.com)
* Fill e-stamp application with:
* First party: Company issuing the certificate
* Second party: Shareholder receiving the shares
* Stamp duty amount
* Article: "Issue of share certificate"
* Make payment online or at SHCIL counter
* Obtain e-Stamp Certificate
#### Step 4: **Affix Stamp / Attach e-Stamp Certificate**
* Paste the e-stamp certificate on the reverse of the physical share certificate or attach it securely.
* Ensure the share certificate is signed and issued within **2 months from the date of allotment**.
---
### 📌 Notes:
* Even if the shares are allotted in **Demat form**, **stamp duty is payable**. NSDL/CDSL may collect it directly.
* **No separate filing is required with the ROC** for stamp duty — Form PAS-3 (earlier Form 2) is filed for allotment, but stamp duty is paid independently.
---
Let me know if you want a sample **board resolution** or **share certificate format** as per Karnataka law.
---
### ✅ **Stamp Duty Rate in Karnataka (on issue of share certificates)**:
As per the **Karnataka Stamp Act, 1957**, under **Article 16**, the rate is:
> 🏷️ **₹1 for every ₹1,000 or part thereof** of the value of shares (including premium, if any).
So, for example:
* If you issue shares worth ₹1,00,000 (including premium), stamp duty = ₹100
* If you issue shares worth ₹1,00,500 → stamp duty = ₹101
---
### 📄 **Procedure for Payment of Stamp Duty in Karnataka**:
#### Step 1: **Calculation**
* Calculate the total value of shares (face value + premium, if any).
* Compute stamp duty at ₹1 per ₹1,000.
#### Step 2: **Mode of Payment**
* **Stamp duty on physical share certificates** is paid by:
* **Affixing adhesive stamps** (not postal stamps), or
* **Paying through e-Stamping** (recommended and accepted by Karnataka government via SHCIL).
#### Step 3: **e-Stamping Process (Karnataka)**
* Visit the SHCIL (Stock Holding Corporation of India Ltd.) website: [https://www.shcilestamp.com](https://www.shcilestamp.com)
* Fill e-stamp application with:
* First party: Company issuing the certificate
* Second party: Shareholder receiving the shares
* Stamp duty amount
* Article: "Issue of share certificate"
* Make payment online or at SHCIL counter
* Obtain e-Stamp Certificate
#### Step 4: **Affix Stamp / Attach e-Stamp Certificate**
* Paste the e-stamp certificate on the reverse of the physical share certificate or attach it securely.
* Ensure the share certificate is signed and issued within **2 months from the date of allotment**.
---
### 📌 Notes:
* Even if the shares are allotted in **Demat form**, **stamp duty is payable**. NSDL/CDSL may collect it directly.
* **No separate filing is required with the ROC** for stamp duty — Form PAS-3 (earlier Form 2) is filed for allotment, but stamp duty is paid independently.
---
Let me know if you want a sample **board resolution** or **share certificate format** as per Karnataka law.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- ITR-Capital Gain
- Gst on travel by air for business purposes
- CLOSING STOCK QUERY
- Loss of interest in PF transfer from EPFO to Trust
- Residential status of non resident
- TDS _Long term Capital Gain ref.sec 214 Table 2
- Can a single LLP in India legally operate multiple unrelated businesses (Travel, Cloud Kitchen, Ecom
- IT returns for fresh job holders
- Query regarding reporting of exempt foreign remuneration in ITR
- GST ISD Query on various AMCs
- Gst reverse charge mechanism to be claimed in the month of payment
- Itr processing refund
- U/S 194 T
- TDS refund Indemnity Bond
- ITC BENEFIT ON BROKRAGE PAID
- PF wage ceiling
- Concept of Vendor and customner reconciliation
- Mistake in e-invoice identified after 24 hours
- EXPORT PAYMENT
- NRI ITR2 account in 2025-26.
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
