Affixing of Revenue Stamps for NGO

Under the Indian Stamp Act, 1899, there is a requirement to affix a revenue stamp on certain receipts, and this rule applies generally regardless of whether the entity is an NGO or a commercial organization.

Key Requirements

• Threshold: A revenue stamp (typically ₹1) is mandatory on any receipt acknowledging the receipt of cash or other movable property if the value exceeds ₹5,000.

• Definition of Receipt: The Act defines a "receipt" broadly to include any note, memorandum, or writing that acknowledges the receipt of money, cheques, promissory notes, or movable property in satisfaction of a debt or demand.

• Payment Mode:

  • Cash Payments: The requirement to affix a revenue stamp applies specifically to cash payments.

  • Non-Cash Payments: Revenue stamps are not required for payments made via cheque, bank transfer, or other electronic/digital modes, regardless of the amount.

• Validation: When a revenue stamp is affixed, the person issuing the receipt must sign across the stamp to validate it. A properly stamped receipt serves as prima facie evidence of the transaction and holds greater legal weight in the event of a dispute.

Application to NGOs

There is no special exemption for NGOs under the Indian Stamp Act regarding this requirement. If your organization issues a receipt for a cash payment exceeding ₹5,000, you are legally expected to follow the same procedure as any other entity. Failure to do so can make the receipt legally invalid as evidence in court proceedings, and under Section 65 of the Act, the person refusing to provide a properly stamped receipt may be subject to a fine.