Stamp Duty Is Unavoidable...

So, in Maharashtra, for example, any transaction relating to property transfer whether moveable or immoveable is charged under the Bombay Stamp Act, 1958. And for other states under their own acts. Which means you cannot buy property without a percentage paid as stamp duty.

Duty rates: The question arises how much duty and where do you pay? Says a spokesperson for a housing finance company, Different states have different rates, and the duty is also structured on the cost of the transaction sale. So the higher the property cost, the higher the stamp duty. (Check box)

Generally stamp duty is paid before signing the agreement document between builder and the buyer. Paid means the value of stamps equals the amount of stamp duty to be paid. Usually it is the buyer who always pays, though there can be cases where if the seller gets a good price, might agree to bear a part of the stamp duty cost. Nowadays, to facilitate an easy payment mode, the buyer can go to the Superintendent of Stamps, pay a cheque equivalent to the duty to be paid and get the documents franked. After which it is sent to the sub-registrar for registration.

 

Market value: Transacting parties might for convenient reasons assess the property at a lower value, to pay a lesser stamp duty. In Maharashtra, to prevent this evasion of duty, a provision was introduced within the Bombay Stamp Act called the market value concept. This is defined as