Section 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 2 of the Indian Stamp Act, 1899 gives a statutory meaning to the names of the most common deeds: conveyance, bond, lease, mortgage-deed, settlement, instrument of partition, power-of-attorney and receipt. Schedule I charges duty by these names, so the definition decides which Article a document falls under. This article covers clauses (10), (5), (16), (17), (24), (15), (21) and (23).
The Act's meanings are often wider than the everyday words. A "conveyance" takes in every instrument that transfers property inter vivos if Schedule I does not deal with it specially. A "lease" includes a patta and a kabuliyat. A "settlement" includes a declaration of trust recorded in writing. A "receipt" includes any writing that acknowledges money or property received or a debt discharged, whether signed or not. Duty on most of these instruments is fixed by the State where the instrument is executed.
How to read this article
This article is based on the consolidated text of the Act consulted (latest amendment shown: Act 13 of 2021); later amendments should be checked. It explains the central Act only. Stamp duty on most instruments is fixed by the law and schedule of the State where the instrument is executed, so the State must be checked for rates and for how each deed is charged. The general terms such as "instrument", "executed" and "duly stamped" are in the first definitions article, and the negotiable-instrument and insurance terms are in a separate sibling article. For help in classifying a particular document before you draft it, see our agreement drafting service.
Each definition opens with "unless there is something repugnant in the subject or context", so a section that uses the word in a narrower sense prevails over the definition for that section.
Clause (10): "conveyance"
"Conveyance" includes a conveyance on sale and "every instrument by which property, whether moveable or immovable, is transferred inter vivos and which is not otherwise specifically provided for by schedule I".
Two points follow. First, it is not limited to land: movable property is included. Second, it is a residual head. If Schedule I already names the transfer specially (for example an exchange, a gift or a release), that special Article applies. Anything else that transfers property between living persons falls under conveyance. The Schedule I articles for conveyance, exchange, gift, partition and release are covered in the article on conveyance, part performance and certificate of sale.
Clause (5): "bond"
"Bond" includes three kinds of instrument:
- (a) an instrument whereby a person obliges himself to pay money to another, on condition that the obligation shall be void if a specified act is performed, or is not performed;
- (b) an instrument attested by a witness and not payable to order or bearer, whereby a person obliges himself to pay money to another; and
- (c) an instrument so attested, whereby a person obliges himself to deliver grain or other agricultural produce to another.
The clause ends with the words "but does not include a debenture", added by Act 7 of 2019, section 12 (with effect from 1 July 2020). The word "attested" in (b) and (c) is a feature a drafter should notice: an unattested promise to pay may fall outside (b).
Clause (16): "lease"
"Lease" means a lease of immovable property, and includes also:
- (a) a patta;
- (b) a kabuliyat or other undertaking in writing, not being a counterpart of a lease, to cultivate, occupy, or pay or deliver rent for, immovable property;
- (c) any instrument by which tolls of any description are let;
- (d) any writing on an application for a lease intended to signify that the application is granted.
The lease Articles are explained in the Schedule I article on lease, surrender of lease and transfer of lease. Note clause (d): even a short writing on an application, if meant to signify that the application is granted, is a lease for this Act.
Clause (17): "mortgage-deed"
A "mortgage-deed" includes every instrument whereby, for the purpose of securing money advanced, or to be advanced, by way of loan, or an existing or future debt, or the performance of an engagement, one person transfers or creates to or in favour of another a right over or in respect of specified property. The definition covers future advances and existing debts, and it covers securing performance, not only repayment. The Schedule I Articles on mortgage-deed, further charge and reconveyance are explained in their own article in this series.
Clause (24): "settlement"
"Settlement" means any non-testamentary disposition, in writing, of moveable or immovable property made:
- (a) in consideration of marriage,
- (b) for the purpose of distributing property of the settler among his family or those for whom he desires to provide, or for providing for some person dependent on him, or
- (c) for any religious or charitable purpose.
It "includes an agreement in writing to make such a disposition" and, "where any such disposition has not been made in writing, any instrument recording, whether by way of declaration of trust or otherwise, the terms of any such disposition". The footnotes show the words about disposition not made in writing were inserted by Act 15 of 1904, section 2.
Clauses (15), (21) and (23): partition, power-of-attorney and receipt
| Clause | Term | Core of the definition as printed |
|---|---|---|
| (15) | Instrument of partition | any instrument whereby co-owners of any property divide or agree to divide it in severalty; includes a final order for effecting a partition passed by any Revenue-authority or any Civil Court, and an award by an arbitrator directing a partition |
| (21) | Power-of-attorney | includes any instrument (not chargeable with a fee under the law relating to Court-fees for the time being in force) empowering a specified person to act for and in the name of the person executing it |
| (23) | Receipt | includes any note, memorandum or writing (a) acknowledging receipt of money or a bill of exchange, cheque or promissory note, (b) acknowledging receipt of other moveable property in satisfaction of a debt, (c) acknowledging that a debt or demand or part of it has been satisfied or discharged, or (d) signifying or importing any such acknowledgment, whether or not signed with the name of any person |
The power-of-attorney definition leaves out instruments that are chargeable with a fee under the law relating to Court-fees; that law is not in the text consulted and is not described. For the Schedule I treatment, see the article on power of attorney and appointment in execution of a power.
A worked example
Anita and Bharat, brothers, jointly own a shop. They sign a document dividing it so that each gets a separate half. Clause (15) calls this an instrument of partition, because co-owners divide property in severalty. Suppose Bharat then signs a one-page writing saying he has received a sum from Anita in settlement of a loan he owed her. Clause (23)(a) and (c) make that writing a receipt, even if he forgets to sign it. Finally, Anita writes to a trust company giving a limited authority to collect her rent in her name; clause (21) treats the authority as a power-of-attorney. One family, three different heads, and each head may have its own Article in the Schedule. The duty on each depends on the State where the document is executed.
Need help with classifying a deed?
Before a deed is drafted or signed, it helps to know which head of the Act it falls under, because that decides how it is charged. Our agreement drafting team can review the document's structure so that the operative words match what the parties intend.
Key takeaways
- "Conveyance" is wide and residual: it covers any transfer inter vivos not specially provided for in Schedule I.
- "Bond" has three limbs and excludes a debenture.
- "Lease" includes a patta, a kabuliyat, a letting of tolls and a writing granting an application for a lease.
- "Settlement" includes a recorded declaration of trust.
- "Receipt" includes any acknowledgment, signed or unsigned.
- Check the State where the instrument is executed for the duty.
Read next
- Section 2 of the Indian Stamp Act, 1899: instrument, executed, duly stamped and stamp
- Section 2 of the Indian Stamp Act, 1899: bill of exchange, promissory note, cheque and policy of insurance
- Schedule I: exchange, gift, partition and release
- Registration Act vs Stamp Act: how they work together
Disclaimer: Based on the consolidated text of the Indian Stamp Act, 1899 published by the Department of Revenue, whose latest amendment shown is Act 13 of 2021, as consulted on 2 October 2026. Only the central text is covered: stamp duty on most instruments is fixed by the law and schedule of the State where the instrument is executed, and State amendments, rules, notifications and later amendments should be checked. This article is general information, not legal advice; check the official text before acting.