Stamp duty on issue of shares in demat form

[Sakshi Vaid]

Dear all,

Since stamp duty is payable on issue of shares in demat form on which value will the stamp duty be payable??
Will it be the nominal value or the the issue price...? In which act is the answer for the same mentioned.?

Please guide me in this matter.

Looking forward for your  valuable comments.

Thanks
Sakshi Vaid
New Delhi

[bhavani prasad]

Dear Sakshi vaid

Stamp duty is not payable for issue of shares in De-mat form.

Sakshi Vaid
New Delhi

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[Sakshi Vaid]

Dear Mr.Prasad,

It is payable .Kindly refer to FAQS given on the NSDL website.

thanks for ur reply but kindly guide me further..

[bhavani prasad]

Dear Sakshi

Stamp duty being a state subject differs from state to state.Please check in which state allotment is being done and accordingly pay stamp duty.

Please deliberate your views

[Sakshi Vaid]

in my case allotment has been made in Haryana...

[bhavani prasad]

Check Haryana states stamp act then.

[Sakshi Vaid]

dear mr.prasad,

can u also guide me where is it mentioned that stamp duty will be calculated as per the place where allotment is made???

tx

[Sakshi Vaid]

Our registered office is in delhi but our corporate office  is in Haryana.All Directors, CEO other working staff are based only in Haryana.Board meetings and decesion, issue of order are only from Haryana office.

For issue of share certificate board meeting is also held in Gurgaon Haryana.

Can we pay stamp duty on share certificate as per Haryana stamp act OR it is required to be paid as per Delhi act.

Please refer case law, book or section in support, if any.

Its URGENT

[bhavani prasad]

Please check the link below which is an excerpt taken from caclubindia.com,let me search for more info on this issue.

For operational convenience BM can be held anywhere not only where the regd office of the Company is situated.

http://www.caclubindia.com/forum/stamp-duty-on-share-certificate-101172.asp

[Sakshi Vaid]

thanks for the useful info...also i want to share with you sec8A of the Indian Stamp Act which says" Securities dealt in depository not liable to stamp duty"..Kindly read this and give your valuable opinion...

[Ainesh Jethwa]

While allotment of shares respective State Stamp Act applies which contains the rate of stamp duty payable on allotment.

Where as transfer of shares is subject to Indian Stamp Act. As Indian Stamp Act says" Securities dealt in depository not liable to stamp duty"..this means that securities dealt in other than allotment or u can say transfer is not liable to stamp duty.

But I am not sure whether shares allotment in demat form require stamp duty to paid.

[Astarag]

Its the practice followed by companies to hold BM for sh allotment  at states having lower stamp duty.

in that case when the certificate comes before the authority in the state where the registered office is situated they may allege

 payment of insufficient stamp duty

as per the stamp act the authority is empowered to ask for payment of differential amount

termed as impounding

instrument not properly stamped are inadmissible as evidence

share certificates are evidence of ownership. hence less stamp means no certificate in real sense

thing is that so far not impounded its well and good

does not matter you pay in state of allotment or state of Registered office

With 

Cs. P.A. Patnaik

[Sakshi Vaid]

Mr.Ainesh as i already replied issue of shares in demat form is also liable for payment of stamp duty...Kindly refer to FAQs of the NSDL. Also i read number of discussion of CA Club India which says the same.

[Ainesh Jethwa]

Thank you Sakshiji,

can you put the link of FAQ of NSDL where it is mentioned about stamp duty.
I have tried to figure out but couldn't.
Please do the needful.

[srinucs srinucs]

Dear Sakshi Vaid

 

Stamp duty has to be paid on allotment of shares either in physical mode or demat. The stamp duty has to be paid as per the respective state stamp duty act with the concrned authorities.

 

Please see the following question and answer from NSDL website.

 

Does the Issuer have to pay stamp duty on securities issued directly in dematerialized form.

Yes, the Issuer has to pay the relevant stamp duty as applicable irrespective whether it is issued in either physical or demat form.

Regards

Srinivas T

Mob: 9538869662.

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[Sakshi Vaid]

https://nsdl.co.in/debtinst/certdep-faq.php

Kindly refer to the above link where its mentioned in the FAQs of the NSDL website that stamp duty will be paid on the issue of shares in demat form.I am again layying stress on my question that on which value will such amount of Stamp duty be payable i.e. the nominal value or the issue price.?
Also in my case the stamp duty will be calculated as per Haryana State.But i culd not find any Haryana Stamp Act.in my opinion the Indian Stamp ACt itself is applicable on Punjab and Haryana.
Kindly guide me in this regard.

Awiating for your precious opinions.

Regards
Sakshi

[Sakshi Vaid]

https://nsdl.co.in/debtinst/certdep-faq.php

Kindly refer to the above link where its mentioned in the FAQs of the NSDL website that stamp duty will be paid on the issue of shares in demat form.I am again layying stress on my question that on which value will such amount of Stamp duty be payable i.e. the nominal value or the issue price.?
Also in my case the stamp duty will be calculated as per Haryana State.But i culd not find any Haryana Stamp Act.in my opinion the Indian Stamp ACt itself is applicable on Punjab and Haryana.
Kindly guide me in this regard

On Tue, Dec 27, 2011 at 10:01 PM, srinucs srinucs <sri...@sify.com> wrote:

[kameswara Rao Kappagantula]

Satmp duty payable on Iissue price i mean if shares are issued at Premium then this also to be included for calculation

Here again the stamp duty act entry is decisive factor as per the state law.

Kamesh

[Ainesh Jethwa]

Thanks Sakshi.

I have googled about haryana state stamp act and it seems it does not have their own stamp act.

http://revenueharyana.gov.in/html/mainchild/acts,rules,manuals.htm

in view of the same, Indian Stamp act will apply.

[Sakshi Vaid]

but i am stuck with the same problem ...now which act shall be applicable???

[sakshi]

Dear All,

What is the usual treatment followed : is the stamp duty paid on shares issued in demat form?

In light of the definition of "document" , share certificates are not covered.section 4 of IT Act, 2000 states that -

Where any law provides that information or any other matter shall be in writing or in the typewritten or printed form, then, notwithstanding anything contained in such law, such requirement shall be deemed to have been satisfied if such information or matter is--

(a) rendered or made available in an electronic form; and

(b) accessible so as to be usable for a subsequent reference.

The depositories act, 1996 provides that a shareholder may request for allotment of shares in demat form.in such case the law does not provide for writing of share certificates.Then how can we contempate that issue of shares in demat form call for payment of stamp duty.
further , as per the definition of document , share certificates do not fall within the purview of document.

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