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Maharashtra Stamp Act: Understanding Its Impact and Changes
Updated : July 12, 2024
Author :
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At any point, if any movable or immovable resource/asset changes ownership, to get it stamped or legalized - a specific amount of tax has to be paid to the state government, which is known as stamp duty. The Maharashtra Stamp Act states such resources and assets on which the stamp obligation must be paid to the state government. The Act additionally specifies the measure of the amount that is to be paid to the state authorities.
The Bombay Stamp Act: A Cornerstone of Revenue Collection in Maharashtra
The Bombay Stamp Act, enacted in 1958, is a pivotal legal framework that governs the collection of stamp duties on document-based transactions within Maharashtra. Originally applied to the greater Bombay region, this act became an integral part of Maharashtra's legislative environment following the state's formation in 1960.
This Act mandates the payment of stamp duty, which is essentially a form of tax, on various documents including transfer deeds, agreements, certificates, bonds, and leases. The primary purpose of this duty is to confer legal authenticity to these documents while generating revenue for state administrative functions.
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Over the years, the Bombay Stamp Act has been amended multiple times to respond to the dynamic economic conditions and real estate market of Maharashtra. These amendments ensure that the stamp duty rates are adjusted and practices streamlined to enhance compliance and minimise evasion.
The implementation of this Act is crucial for the state as it not only secures revenue but also supports the maintenance of a robust legal documentation system, which is fundamental to the functioning of both governmental and private sector transactions.
What is the Maharashtra Stamp Act?
The Bombay Stamp Act 1958 now known as the Maharashtra Stamp Act 1958, applies to every one of the agencies that are referenced in Maharashtra Stamp Act Schedule 1, on which the stamp duty is payable to the state. There was an amendment in the Maharashtra Stamp Act recently and the changes are inclusive to the modification of stamp duty on the agreement in Maharashtra on gift deeds, incorporation of electronic payment of stamp duty, an update on penalty clauses, and an increment on the amount of stamp duty under certain instruments provisions.
As of January 25, 2024, there are notable updates regarding the Maharashtra Stamp Act. Firstly, the 1% stamp duty concession for women purchasing residential property continues. This reduction applies to the standard rates, which vary between 2% to 5%, and the previous 15-year lock-in period for beneficiaries was abolished as of May 31, 2023.
Additionally, the Maharashtra government introduced the 'Abhay Yojana' amnesty scheme in December 2023. This scheme, in its second phase until March 31, 2024, allows the regularisation of inadequately stamped documents with reduced penalties. Benefits include a complete waiver of stamp duty and penalties for amounts under Rs. 1 lakh and a 50% waiver on stamp duty with full penalty exemption for amounts over Rs. 1 lakh.
Importantly, the stamp duty rates for the fiscal year 2023-24 remain unchanged from the previous year.
Latest Maharashtra Stamp Act
The Maharashtra Stamp Act latest involves several important changes and continuations of previous policies as of 2024:
- Stamp Duty Concession for Women: Maharashtra continues to offer a 1% stamp duty concession for women purchasing residential property. This initiative aims to encourage property ownership among women. The earlier 15-year lock-in period that restricted the resale of these properties to men has been abolished as of May 31, 2023 (Housing).
- Stamp Duty Rates: Standard stamp duty rates have been restored to 5% in Mumbai after a temporary reduction during the pandemic. These rates apply from April 2021 onwards, with specific concessions for certain types of properties and transactions.
- Amnesty Scheme: The Maharashtra government has extended the Stamp Duty Amnesty Scheme until June 30, 2024. This scheme provides relief for properties that had incomplete or missing stamp duty payments dating back to 1980. The extension allows property owners to regularise documents with waived penalties under specified conditions.
Maharashtra Stamp Act 2015
On 24 April 2015, the original Maharashtra Stamp Act 1958 received the affirmation for it to be called the Maharashtra Stamp Act 2015. There were a few changes made to the Act – the stamp duty rate of certain instruments under Schedule 1 was increased. Therefore, the Maharashtra Stamp Amendment Act 2015 first came into order.
How is Stamp Duty Payable?
- Stamp Duty can be paid by:
- Using Stamp Paper
- Using Adhesive Stamps
- Online Challan
- EBSTR
- Franking
Stamp Duty Rates in Maharashtra
There are various factors that decide the stamp rate duty on property in the state of Maharashtra (or any state). Naming a few of these factors - the locality of the property - urban or rural, the total cost of the transaction, etc. The Maharashtra stamp duty Act 2020, reduced the stamp duty on properties for the next two years. This is only applicable in the areas falling under the Mumbai Metropolitan Region Development Authority (MMRDA) and municipal corporations of Pune, Pimpri-Chinchwad, and Nagpur. This means that stamp duty on properties in Mumbai, Pune, and Nagpur, was charged at 5% (4% stamp duty + 1% metro cess).
| Cities | Stamp duty rates (w.e.f. April 1, 2021) | Stamp duty rates from September 1, 2020 till December 31, 2020 | Stamp duty rates from January 1, 2021 till March 31, 2021 | Registration Charges |
| Mumbai | 5% (includes 1% metro cess) | 2% | 3% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
| Pune | 6% (includes transport surcharge and local body tax) | 3% | 4% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
| Thane | 6% (includes transport surcharge and local body tax) | 3% | 4% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
| Navi Mumbai | 6% (includes transport surcharge and local body tax) | 3% | 4% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
| Pimpri-Chinchwad | 6% (includes transport surcharge and local body tax) | 3% | 4% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
| Nagpur | 6% (includes transport surcharge and local body tax) | 3% | 4% | Rs 30,000 (for properties above Rs 30 lakh); 1% (for properties below Rs 30 lakh) |
Stamp Duty on Hypothecation Agreement in Maharashtra
Stamp Duty on hypothecation agreements in Maharashtra on instruments, pledges and mortgages on home loans in the province of Maharashtra was capped. As per the latest Maharashtra stamp act, the stamp obligation on such instruments is currently covered at a greater stamp duty of Rs. 10,00,000). This revision has been presented with impact from 1 July 2014.
Stamp Duty Charges in Maharashtra on Conveyance Deed
According to the amendments made to the Maharashtra Stamp Act 2015, Article 34 states that 3% of the property’s value is the stamp duty on conveyance deeds (gift deeds). However, if a property – Residential or Agricultural, is gifted without the family having to pay any sum of money, then the stamp duty rate is Rs. 200 as per article 34 of the Maharashtra stamp act.
| Conveyance Deed | Stamp duty rate |
| Gift deed | 3% |
| Gift deed for residential/agricultural property passed on to family members | Rs 200 |
| Lease deed | 5% |
| Power of attorney | 3% for property located in gram panchayat areas and 5% for property located in municipal areas. |
Stamp Duty on Indemnity Bond in Maharashtra
According to Article 35 of Schedule 1 of the Maharashtra Stamp Act 1958, and then the Maharashtra Stamp (Amendment) Act 2015 - the price of the stamp duty on indemnity bonds in Maharashtra is Rs 500.
Stamp Duty on Guarantee Agreement in Maharashtra
According to Article 5(h) (A)(iv), the stamp duty on bank guarantee agreements in Maharashtra is –
(i) If the loan amount is less than Rupees Ten Lakh - 0.1% of the amount stipulated in the contract, with a minimum of rupees 100.
(ii) If the amount exceeds Rupees Ten Lakh, the stamp duty on the personal guarantee in Maharashtra – 0.2% of the amount agreed in the contract.
Maharashtra Stamp Duty Impact on Property Registration
Property registrations saw a dip of 50% in the month of April as compared to that of the month of March after the Maharashtra government restored the stamp duty rate of 5% from 1 April 2021. According to the state government’s data, before the sanctions were to be lifted – in the month of March, Maharashtra (excluding) Mumbai saw a record-breaking spike of 2.13 lakh registrations. While only 90,500 registrations were made till 29 April. Maharashtra stamp duty had a huge impact on property registrations.
Official announcement of the cut of stamp duty on loan agreements in Maharashtra had seen a boost in property sales, especially in Mumbai (Bombay, as we know, is one of the most expensive cities in India). There were many Bollywood A-listers such as Hrithik Roshan and Jahnvi Kapoor who were seen buying properties. Between September 1 and October 17, 2020, luxurious properties were registered across 25 registration offices in Mumbai that were collectively worth 2200 crores.
Recent Judgements on Maharashtra Stamp Duty
The Bombay High Court in a recent judgement directed the Government of Maharashtra to reimburse excess stamp duty, within about a month from the date of the receipt of the application. If the authorities fail to do so, they are applicable to pay interest at the rate of 12% p.a. The above order was applicable even on the stamp duty on education loan in Maharashtra.
In a landmark ruling, the High Court decided in favour of Macrotech Developers Ltd and Palava Dwellers regarding their land purchase under 'Integrated Township Projects' in Kalyan and Bhiwandi. These projects qualified for a 50% reduction in stamp duty. The state initially rejected the combining of this discount with another waiver on stamp duty for conveyance agreements, but the High Court ruled that both concessions are applicable concurrently. Consequently, the state was ordered to refund any excess stamp duty paid within a specified timeframe.
Maharashtra Stamp Duty Act has seen various amendments through time. Legal matters may seem hard to keep up with and a little hard to understand, but don’t let that stop you. We at NoBroker are here to help you. Click on the link below and we will assist you on legal matters. If you have any queries, leave them below and our experts will get back to you.
Frequently Asked Questions
Ans: No, the rate of stamp duty is not the same across the whole state of Maharashtra. The price depends on the location of the property. The rates are mentioned in the above article.
Ans: Yes, you can pay it online. Visit their site - https://gras.mahakosh.gov.in/echallan/
Ans: The price for the stamp duty is Rs 500, which is also payable online.
Ans: Yes, they are. Earlier the Maharashtra Stamp Act was referred to as the Bombay Stamp Act.
Ans: Ready reckoner state or the market value is how the rate of the stamp duty is calculated.
Ans: The Maharashtra Stamp Act Bare Act is the fundamental legal document outlining the rules and regulations for stamp duty and taxation on property transactions in Maharashtra.
Ans: No simple receipt may be considered genuine unless it is altered within six months of the date of stamp purchase by the registration officer or another officer with the necessary authority.
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