Rates on Securities
Article 27 was substituted and Article 56A was inserted by Act 7 of 2019, section 21, with effect from 1 July 2020. Both Articles refer to sections 9A and 9B for the manner of charge.
| Article | Instrument | Rate of duty |
|---|---|---|
| 27(a) | Debenture, as defined by section 2(10A): in case of issue of debenture | 0.005% |
| 27(b) | Debenture: in case of transfer and re-issue of debenture | 0.0001% |
| 56A(a) | Issue of security other than debenture | 0.005% |
| 56A(b) | Transfer of security other than debenture on delivery basis | 0.015% |
| 56A(c) | Transfer of security other than debenture on non-delivery basis | 0.003% |
| 56A(d)(i) | Derivatives: futures (equity and commodity) | 0.002% |
| 56A(d)(ii) | Derivatives: options (equity and commodity) | 0.003% |
| 56A(d)(iii) | Derivatives: currency and interest rate derivatives | 0.0001% |
| 56A(d)(iv) | Derivatives: other derivatives | 0.002% |
| 56A(e) | Government securities | 0% |
| 56A(f) | Repo on corporate bonds | 0.00001% |
Article 27 exempts a debenture issued by an incorporated company or other body corporate in terms of a registered mortgage-deed duly stamped for the full amount of debentures to be issued under it, where the debentures are expressed to be issued in terms of that deed. Interest coupons attached to a debenture are not included in estimating the duty.
Who Collects and Who Pays
| Transaction | Duty collected by, and from whom | Value on which duty is charged | Provision |
|---|---|---|---|
| Sale of securities through a stock exchange, delivery based or otherwise | Stock exchange or a clearing corporation authorised by it, from the buyer | Market value of the securities at the time of settlement | Section 9A(1)(a) |
| Transfer of securities for a consideration made by a depository, other than a stock exchange sale | Depository, from the transferor | Consideration amount specified | Section 9A(1)(b) |
| Issue of securities leading to creation or change in the records of a depository | Depository, from the issuer | Total market value of the securities in the allotment list | Section 9A(1)(c) |
| Issue of securities otherwise than through a stock exchange or depository | Payable by the issuer, at the place where its registered office is located | Total market value of the securities issued | Section 9B(a) |
| Sale, transfer or reissue of securities for consideration otherwise than through a stock exchange or depository | Payable by the seller, transferor or issuer | Consideration amount specified in the instrument | Section 9B(b) |
Instruments under section 9A(1) need not be stamped (section 9A(2)). No duty is chargeable on instruments of transaction in stock exchanges and depositories established in an International Financial Services Centre (proviso to section 9A(2)). The duty collected is transferred to the State Government within three weeks of the end of each month (section 9A(4)).
Bills of Exchange and Promissory Notes
Article 13 charges a bill of exchange payable otherwise than on demand, by the period after date or sight. Articles 13 and 14 were substituted by notification S.O. 130(E) dated 28 January 2004.
| Bill payable | Amount not exceeding Rs. 500 | Exceeds Rs. 500 but not Rs. 1,000 | Every additional Rs. 1,000 or part |
|---|---|---|---|
| Not more than three months after date or sight | Thirty paise | Sixty paise | Sixty paise |
| More than three months but not more than six months | Sixty paise | One rupee twenty paise | One rupee twenty paise |
| More than six months but not more than nine months | Ninety paise | One rupee eighty paise | One rupee eighty paise |
| More than nine months but not more than one year | One rupee twenty five paise | Two rupees fifty paise | Two rupees fifty paise |
| More than one year after date or sight | Two rupees fifty paise | Five rupees | Five rupees |
Promissory note (Article 49): when payable on demand, ten naye paise where the amount or value does not exceed Rs. 250, fifteen naye paise where it exceeds Rs. 250 but does not exceed Rs. 1,000, and twenty-five naye paise in any other case. When payable otherwise than on demand, the same duty as a bill of exchange (No. 13) for the same amount.
Other Instruments with a Union Rate
Section 9(2)(a) names the instruments for which "the Government" is the Central Government: bills of exchange, cheques, promissory notes, bills of lading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts.
| Article | Instrument | Proper stamp duty |
|---|---|---|
| 14 | Bill of lading (including a through bill of lading) | One rupee |
| 37 | Letter of credit, that is, any instrument by which one person authorizes another to give credit to the person in whose favour it is drawn | Two rupees |
| 52 | Proxy empowering any person to vote at any one election or at any one meeting of members of an incorporated company or other body corporate, a local authority, or proprietors, members or contributors to the funds of any institution | Thirty paise |
| 53 | Receipt, as defined by section 2(23), for any money or other property the amount or value of which exceeds five thousand rupees | One rupee |
If a bill of lading is drawn in parts, each one of the set must bear the proper stamp. Items (a) and (b) of Article 62 (transfer of shares and of debentures) were omitted by Act 7 of 2019. Transfers of securities are now charged under Articles 27 and 56A.
Policies of Insurance
The Act prints these amounts in naye paise. Where two amounts are given, the first is for a policy drawn singly and the second is for each part of a policy drawn in duplicate.
| Division | Policy | Proper stamp duty, as printed |
|---|---|---|
| A(1)(i) | Sea insurance for or upon any voyage, where the premium or consideration does not exceed the rate of one-eighth per centum of the amount insured | Ten naye paise; five naye paise |
| A(1)(ii) | Sea insurance for or upon any voyage, in any other case, for every full sum of one thousand five hundred rupees and any fractional part insured | Ten naye paise; five naye paise |
| A(2) | Sea insurance for time, for every full sum of one thousand rupees and any fractional part insured: time not exceeding six months | Fifteen naye paise; ten naye paise |
| A(2) | Sea insurance for time: exceeding six months and not exceeding twelve months | Twenty-five naye paise; fifteen naye paise |
| B(1)(i) | Fire-insurance and other classes of insurance covering goods, merchandise, personal effects, crops and other property against loss or damage, original policy, sum insured not exceeding Rs. 5,000 | Fifty naye paise |
| B(1)(ii) | The same, original policy in any other case | One rupee |
| B(2) | Each receipt for any payment of a premium on any renewal of an original policy | One-half of the duty payable on the original policy, in addition to the amount, if any, chargeable under No. 53 |
| C(a) | Accident and sickness insurance against railway accident, valid for a single journey only | Ten naye paise |
| C(b) | Accident and sickness insurance in any other case, on the maximum amount payable for a single accident or sickness: where it does not exceed Rs. 1,000, and for every Rs. 1,000 or part where it exceeds Rs. 1,000 | Fifteen naye paise |
| C(b) proviso | Policy against death by accident where the annual premium payable does not exceed Rs. 2.50 per Rs. 1,000, for every Rs. 1,000 or part of the maximum amount payable | Ten naye paise |
| CC | Insurance by way of indemnity against liability to pay damages on account of accidents to workmen or compensation under the Workmen's Compensation Act, 1923, for every Rs. 100 or part payable as premium | Ten naye paise |
| D(i) | Life insurance or group insurance or other insurance not specifically provided for: for every sum insured not exceeding Rs. 250 | Fifteen naye paise; ten naye paise |
| D(ii) | The same: for every sum insured exceeding Rs. 250 but not exceeding Rs. 500 | Twenty five naye paise; fifteen naye paise |
| D(iii) | The same: for every sum insured exceeding Rs. 500 but not exceeding Rs. 1,000, and for every Rs. 1,000 or part in excess of Rs. 1,000 | Forty naye paise; twenty naye paise |
| E | Re-insurance by an insurance company of a policy of the nature in Division A or Division B | One-quarter of the duty payable on the original insurance, but not less than ten naye paise or more than one rupee |
Division E adds that if the total duty is not a multiple of five naye paise it is rounded off to the next higher multiple of five naye paise. A letter of cover or engagement to issue a policy is exempt, subject to the proviso in the General Exemption.
How to Use This Chart
- For an issue of shares made otherwise than through a stock exchange or depository, the issuer pays 0.005% on the total market value at the place where its registered office is located (section 9B(a) with Article 56A(a)).
- For a sale or transfer of shares made otherwise than through a stock exchange or depository, the seller or transferor pays on the consideration amount stated in the instrument (section 9B(b)): 0.015% for a transfer on delivery basis.
- Stock exchange and depository transactions need no stamp on the instrument: the exchange, clearing corporation or depository collects the duty.
- The chart shows only the rates printed in Schedule I for these instruments. Conveyance, lease, mortgage, partnership, power of attorney and other instruments are charged at State rates (Schedule I-A or the State Stamp Act) and are not shown.
- Article 19 (share certificate) and Article 36 (letter of allotment) are printed in annas in the saved copy and are left out.
- The saved copy is the Department of Revenue text with footnotes up to Act 13 of 2021 (28 March 2021). Any later amendment or notification under section 9 reducing or remitting a duty is not included.
- In the saved copy the nine rates of Article 56A are printed as one column beside the nine items. The chart pairs them in the printed order.
- The rules made by the Central Government under section 9A for collection of the duty, and the facilitation charges under section 9A(4), are not shown.
Official documents behind this page
- Indian Stamp Act, 1899, Schedule I (Department of Revenue copy)Article 27 (debenture), Article 56A (security other than debentures, items (a) to (f)), Article 13 (bill of exchange), Article 14 (bill of lading), Article 37 (letter of credit), Article 47 (policy of insurance, Divisions A to E), Article 49 (promissory note), Article 52 (proxy), Article 53 (receipt), Article 62 (footnote on omitted items (a) and (b)).
- Indian Stamp Act, 1899, sections 9, 9A and 9BSection 9(2)(a) (instruments for which the Government means the Central Government); section 9A(1) to (4) (stock exchange and depository transactions); section 9B (issue and transfer otherwise than through a stock exchange or depository).
Disclaimer: This guide is general information based on the law and notifications in force when it was last updated. It is not professional advice for your case — rates, thresholds and due dates change, so check the current position or speak to our CA team before you act on it.