Stamp duty on shares transfer
This query is : Resolved
12 April 2017
who will bear stamp duty on share transfer of private company? and how?
CS Mitesh Mehta
(Expert)
12 April 2017
The Section 29 of Stamp Act says that in the absence of an agreement to the contrary the expenses of providing the proper stamp shall be borne, in the case of transfer of shares of an incorporated company or other body corporate, by the persons executing the document.
In the case of transfer of shares of a company it is the seller who is responsible for payment of stamp duty (Union of India vs. Kulu ValleyTransport Ltd. (1958) 28 Comp. cas. 29).Transferor has to bear the stamp duty
As per Section 17 of the Stamp Act any instrument chargeable with duty, should be stamped before the instrument is signed. Thus it indicates that transferor has to bear the stamp duty. But in practice some times the transferee who affixes the share transfer stamps on the instrument at the time of lodging the same for registration of transfer in his favour.
In the case of transfer of shares of a company it is the seller who is responsible for payment of stamp duty (Union of India vs. Kulu ValleyTransport Ltd. (1958) 28 Comp. cas. 29).Transferor has to bear the stamp duty
As per Section 17 of the Stamp Act any instrument chargeable with duty, should be stamped before the instrument is signed. Thus it indicates that transferor has to bear the stamp duty. But in practice some times the transferee who affixes the share transfer stamps on the instrument at the time of lodging the same for registration of transfer in his favour.
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12 April 2017
if transferee pay stamp duty on shares transfer then there is no violation of any compliance? that transferee may pay stamp duty?
CS Mitesh Mehta
(Expert)
13 April 2017
YES Transferee may pay stamp duty
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