The Maharashtra Stamp Act Bare Act is the legislation that governs stamp duty on various legal documents and transactions within the state, outlining rates, payment methods, and legal implications. It was originally called the Bombay Stamp Act.
By Admin | 
This legislation ensures that all legal and financial documents are adequately stamped, thereby making them legally valid and enforceable in courts. Here’s an in-depth look at the essential features of the Maharashtra Stamp Act, its implications, and the processes associated with it. This blog will serve as a guide to the Maharashtra Stamp Act for homebuyers, focusing on its impact on your property purchase.
The Stamp Act is a law designed to collect taxes on certain instruments or documents. Its primary purpose is to provide legal validity to documents and generate revenue for the state. This act applies to various legal instruments, ensuring that all transactions are documented and taxed appropriately.
The Maharashtra Stamp Act, originally enacted in 1958, is the rulebook for stamp duty in the state. It specifies which documents are taxed, how much you owe, and how to pay.
The Act applies to agreements, gift deeds, conveyance deeds, leases, partnership deeds, and other specified documents listed in Schedule I.
Notable changes include the introduction of e-stamping in 2013 and the reduction in stamp duty rates for women purchasers in 2024.
According to a Financial Express report, from September 1st to December 31st, 2020, stamp duty was reduced by 3%, followed by a further reduction of 2% from January 2021 to March 2021 by the Maharashtra government. This initiative proved successful, resulting in a significant increase in property registrations and providing a much-needed boost to the real estate sector.
The Maharashtra Stamp Act, as of 2024, includes several important updates. These updates focus on encouraging female homeownership, reinstating standard rates after pandemic-related adjustments, and providing a pathway for rectifying past stamp duty payment issues.
As per the latest act, purchasing a new flat in Pune involves a 5% stamp duty, along with a 1% local body tax, a 1% metro cess, and a 1% registration charge (capped at Rs. 30,000). Buyers of new flats should verify the latest government regulations and consult with legal advisors to ensure they understand all applicable costs.
Stamp duty is usually a percentage of the higher of the transaction value or the market value of the property. Your property’s location (e.g., within municipal corporation limits or in a rural area) can also affect the rates.
The calculation of stamp duty in Maharashtra is straightforward. Multiply the applicable rate by the higher of the transaction value or market value. For example, if you’re buying a property for ₹75 lakhs and the stamp duty rate is 5%, your stamp duty would be ₹3.75 lakhs.
The Maharashtra Stamp Act outlines how stamp duty is levied, collected, and enforced. It governs all transactions involving movable and immovable property and other legal instruments. Here are the core elements:
For guarantee agreements:
Stamp duty is usually a percentage of the higher of the transaction value or the market value of the property. Your property’s location (urban or rural) also affects the rate.
Multiply the applicable stamp duty rate by the higher of the market or agreement value. For example, on a ₹75 lakh property at 5% duty, you pay ₹3.75 lakhs.
Buyers are advised to consult legal experts for up-to-date information and compliance.
| Update Description | Effective Date |
|---|---|
| Reduction of stamp duty by 1% for women purchasers | January 2024 |
| Amnesty scheme for under-stamped documents introduced | December 2023 |
| Article No. | Description | Stamp Duty Before Amendment | Stamp Duty After Amendment |
|---|---|---|---|
| Article 4 | Affidavit signed under oath or affirmation | INR 100 | INR 500 |
| Article 5(h)(B) | Agreement, record, or memorandum unless otherwise specified | INR 100 | INR 500 |
| Article 8 | Appraisement or valuation during a suit without a court order | INR 100 | INR 500 |
| Article 9 | Apprenticeship Deed (non-clerkship) | INR 100 | INR 500 |
| Article 10 | Articles of Association of a company | 0.2% (max INR 50,00,000) | 0.3% (max INR 1,00,00,000) |
| Article 12 | Arbitration Award | INR 500 | See below |
| 1. Relating to movable property | Same as Conveyance under Article 25(b) | ||
| 2. Movable property up to ₹50,00,000 | 0.75% of the awarded amount | ||
| 3. ₹50L–₹5Cr movable property | ₹37,500 + 0.5% of the awarded amount | ||
| 4. Above ₹5Cr movable property | ₹2,62,500 + 0.25% of the awarded amount | ||
| Article 27 | Duplicate or counterpart of a duly stamped instrument | Max INR 100 | Max INR 500 |
| Article 30 | Divorce deed | INR 100 | INR 500 |
| Article 38 | Letter of License (agreement to suspend debt recovery temporarily) | INR 100 | INR 500 |
| Article 44 | Note of protest by the ship master | INR 100 | INR 500 |
| Article 47(1)(b) | Partnership/LLP/JV deed (cash contribution above ₹50,000) | 1% (max INR 15,000) | 1% (max INR 50,000) |
| Article 49 | Protest of Bill or Note by Notary | INR 100 | INR 500 |
| Article 50 | Protest by the ship master (e.g., voyage declarations) | INR 100 | INR 500 |
| Article 52(a) | Release of ancestral property | INR 200 | INR 500 |
| Article 58(a) | Surrender of Lease without consideration | INR 200 | INR 500 |
| Article 63 | Works contract (including sub-contracts) | ||
| 1. Up to ₹5 lakhs | INR 500 | INR 500 | |
| 2. Above ₹5 lakhs | ₹500 + 0.1% above ₹10L (max ₹25L) | ₹500 + 0.3% above ₹5L (max ₹25L) |
Stamp duty rates in Maharashtra vary based on several factors, primarily the location of the property and the gender of the buyer. Here’s a general overview:
Stamp duty rates can differ between major cities and other areas within Maharashtra. Here’s a breakdown for some key locations:
Varies between 3% to 5% of the property value, with reductions for family transfers and first-time buyers.
Here are the effects of stamp duty on registering property:
Legal Implications: Documents with unpaid or underpaid stamp duty are considered invalid in legal proceedings. This means property transactions could be challenged, leading to ownership disputes.
Penalties: Under the Maharashtra Stamp Act, 1958, failing to pay the required stamp duty on property transactions can lead to significant penalties. Specifically, the Act stipulates a penalty of 2% per month on the deficient stamp duty amount, with the total penalty capped at a maximum of 200% of the unpaid duty.
Complying with the Maharashtra Stamp Act not only ensures smooth transactions but also maintains the credibility and transparency of the real estate sector.
Here’s how stamp duty influences the broader real estate sector:
Ensure the correct calculation of stamp duty based on the market value of the property or the agreement value, whichever is higher. This is crucial to avoid overpayment or penalties.
Always consult legal professionals or property lawyers to double-check the stamp duty calculation, applicable charges, and compliance requirements. This will minimise the risk of disputes or legal complications later.
Cross-verify that all necessary documents—including sale deeds, gift deeds, or lease agreements—are duly stamped and registered before signing any contract. Keeping a record of these documents ensures smooth property ownership transfers.
If you are a woman buyer or fall under any special category eligible for concessions, ensure you take full advantage of reduced rates. Understanding the latest provisions can help you save significantly.
Pay the stamp duty on time to avoid penalties. Make use of convenient payment modes such as e-stamping or authorised collection centres to streamline the process.
Adhering to the Maharashtra Stamp Act is vital for seamless property transactions. Beyond ensuring legal validity, proper compliance protects buyers and sellers from future disputes. To navigate the complexities of stamp duty registration charges in Pune or some other Maharashtra city, consulting legal experts is highly recommended. With the right guidance, owning your dream home becomes a hassle-free reality.
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The Maharashtra Stamp Act Bare Act is the legislation that governs stamp duty on various legal documents and transactions within the state, outlining rates, payment methods, and legal implications. It was originally called the Bombay Stamp Act.
Stamp duty in Maharashtra is calculated by multiplying the applicable rate by the higher transaction value or market value of the property. Rates vary based on location, property type, and buyer’s gender.
No, GST on stamp duty is not applicable. Stamp duty is a tax imposed by state governments on the transfer of property and is separate from GST, which is a tax on the supply of goods and services.
In Maharashtra, stamp duty validity in Maharashtra is not explicitly defined in terms of a specific time frame. Once stamp duty is paid on a document, it remains valid indefinitely, provided the document is executed within the state and follows the Maharashtra Stamp Act. However, it’s essential to ensure that the stamp paper is used within six months of its purchase to avoid legal issues.
Yes, GST on sales of property is applicable on the sale of under-construction properties at a rate of 12%. However, no GST is charged on completed or ready-to-sale properties, provided the Completion Certificate (CC) has been issued.
By Admin