Section 9B 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 9B of the Indian Stamp Act, 1899 is the companion to section 9A. Where section 9A deals with securities issued, sold or transferred through a stock exchange or a depository, section 9B deals with the rest: an issue of securities made otherwise than through a stock exchange or depository, and a sale, transfer or reissue for consideration made otherwise than through one. It names who pays and on what value.
On an issue outside an exchange or depository, the issuer pays, at the place where its registered office is located, on the total market value of the securities issued, at the rate in Schedule I. On a sale, transfer or reissue for consideration outside an exchange or depository, the duty is payable by the seller, transferor or issuer, as the case may be, on the consideration amount specified in the instrument, at the rate in Schedule I.
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 anything outside the securities rules. For debentures and the transfer of shares, section 9(2)(a) names the Central Government as "the Government", and the rate is the one the central Schedule prints; any reduction or remission under section 9 and later amendments should be checked. For share transfers in practice, see our share transfer service.
Section 9B closes Part AA of Chapter II, which the footnotes show was inserted by Act 7 of 2019, section 15, with effect from 1 July 2020 (earlier notified with effect from 9 January 2020 followed by 1 April 2020). It begins "Notwithstanding anything contained in this Act". The meaning of "market value" is in section 2(16B), which uses the price or consideration mentioned in the instrument for securities dealt with outside an exchange or depository; see our article on the securities definitions.
Clause (a): issue otherwise than through an exchange or depository
Clause (a) says: "when any issue of securities is made by an issuer otherwise than through a stock exchange or depository, the stamp-duty on each such issue shall be payable by the issuer, at the place where its registered office is located, on the total market value of the securities so issued at the rate specified in Schedule I".
Four features:
- Who: the issuer.
- Where: at the place where its registered office is located. The text does not name a State; it names the place of the registered office.
- On what: the total market value of the securities issued, in line with section 2(16B)(c) for dealings outside an exchange or depository.
- How much: the rate specified in Schedule I.
The word "each" is worth noticing: duty is on "each such issue", so a company that makes separate issues has a separate charge for each.
Clause (b): sale, transfer or reissue for consideration
Clause (b) says: "when any sale or transfer or reissue of securities for consideration is made otherwise than through a stock exchange or depository, the stamp-duty on each such sale or transfer or reissue shall be payable by the seller or transferor or issuer, as the case may be, on the consideration amount specified in such instrument at the rate specified in Schedule I."
Again four features:
- Which events: a sale, a transfer or a reissue, each for consideration.
- Who: the seller or transferor, or the issuer in the case of a reissue.
- On what: the consideration amount specified in the instrument. So the figure written in the instrument is the base; the Act does not here ask for a separate market valuation.
- How much: the rate specified in Schedule I.
A transfer without consideration is not within the words of clause (b), which speaks of "for consideration". The text consulted does not say how such a transfer is charged under this Part.
Section 9A and section 9B side by side
| Point | Section 9A | Section 9B |
|---|---|---|
| Route | Through a stock exchange, or by a depository | Otherwise than through a stock exchange or depository |
| Who pays or collects | Collected by the exchange, clearing corporation or depository on behalf of the State Government | Payable by the issuer, seller or transferor |
| Base | Market value (exchange sale, issue), or consideration amount (depository transfer) | Total market value (issue), or consideration amount in the instrument (sale, transfer, reissue) |
| Rate | Schedule I | Schedule I |
| Stamping | Instruments need not be stamped | Not stated in section 9B itself |
Section 9B itself does not say that the instrument need not be stamped, as section 9A(2) does for its instruments, and the text consulted does not add that here. How a stamp is paid for State instruments is a matter of State law, and a reader should check the State where the instrument is executed.
The rate comes from the Schedule
The central Schedule's Articles 27 (debentures) and 56A (securities other than debentures) both carry the words "see sections 9A and 9B". For debentures, the central Schedule prints 0.005% for the issue and 0.0001% for the transfer and re-issue. For securities other than debentures, it prints 0.005% for the issue, and for transfers it prints separate percentages for the delivery basis and the non-delivery basis. The copy consulted prints the duty column of Article 56A out of line with its descriptions, so the percentages should be checked against the official text. These Articles are covered in the Schedule I article on debentures and other securities. Valuation rules for stock and marketable securities are in section 21, in the article on valuation of foreign currency, securities and interest. Who bears the duty as between the parties is dealt with in section 29, which has its own article on who bears the stamp duty.
A worked example with the Schedule's percentages
Narmada Power Limited, with its registered office in one city, issues debentures of a total market value of Rs 10 crore directly to a few investors, without a stock exchange or depository. Under clause (a), Narmada pays the duty on the issue, at the place where its registered office is located. Using the debenture issue percentage the central Schedule prints for Article 27(a), 0.005%, the duty on Rs 10 crore is Rs 50,000. Check whether any reduction or remission under section 9 applies.
Later, one investor sells debentures to another privately for a consideration of Rs 2,00,000 stated in the transfer instrument. Under clause (b), the seller pays on the consideration amount specified. At the percentage printed for Article 27(b), 0.0001%, the duty is Rs 0.20, that is twenty paise. The two examples use only the section's mechanics and the percentages the central Schedule prints; they are not a statement of the duty on any particular transaction today.
Need help with an off-market issue or transfer?
Private placements, buy-backs and transfers between shareholders often happen outside any exchange or depository. If you are preparing one and want the instrument, the consideration clause and the duty route checked, our share transfer team can go through the documents with you.
Key takeaways
- Section 9B covers issues, sales, transfers and reissues made otherwise than through a stock exchange or depository.
- On an issue, the issuer pays at the place of its registered office on the total market value, at the Schedule I rate.
- On a sale, transfer or reissue for consideration, the seller, transferor or issuer pays on the consideration amount in the instrument.
- Section 9B is the companion to section 9A, and both take their rates from Schedule I.
- Rates are quoted only as the central Schedule prints them; check for reductions under section 9.
Read next
- Section 9A of the Indian Stamp Act, 1899: stamp duty on sale, transfer and issue of securities through a stock exchange and depository
- Sections 9A and 62A of the Indian Stamp Act, 1899: remitting duty, reporting and penalty
- Section 8A of the Indian Stamp Act, 1899: securities issued to and held through a depository
- Stamp duty on share transfer deed
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.