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Stamp Duty Reduction Unveiled in the Latest Amnesty Scheme.

Updated: Dec 28, 2023




In a significant move aimed at boosting economic activities to facilitate property transactions and providing relief to property buyers, the government has introduced a groundbreaking amnesty scheme that includes a substantial reduction in stamp duty. Stamp duty, a crucial aspect of property transactions, has often been a substantial financial burden for buyers. This strategic move aims to boost the real estate sector and provide relief to homebuyers. Stamp duty is a state-imposed tax levied on the execution of various legal documents, including property transactions.


Key Features of the Stamp Duty Amnesty Scheme:

a)      Significant Reduction in Stamp Duty Rates

The stamp duty amnesty scheme brings about a noteworthy reduction in stamp duty rates across various property categories. This reduction is a deliberate effort to make property transactions more attractive and accessible to a wider segment of the population.


b)      Period of Stamp duty amnesty scheme:

The scheme outlines a specific period during which the reduced stamp duty rates will be applicable. This time-bound approach encourages prompt action from old buyers and aims to create a sense of urgency in the property market.


c)      Incentives for Timely Compliance:

Buyers who complete their property transactions within the stipulated timeframe stand to benefit from lower stamp duty rates, providing an additional incentive for quick decision-making.


d)      Boost to Economic Activities:

By reducing the financial burden on property transactions, the stamp duty amnesty scheme is anticipated to generate increased activity in the real estate sector.


e)      Cost Savings for Old Buyers:

The primary advantage for homebuyers is the substantial reduction in overall property acquisition costs. Lower stamp duty rates translate into immediate cost savings, making homeownership a more attainable goal for many.


f)      Increased Affordability:

The reduction in stamp duty contributes to increased affordability. This affordability factor is expected to drive demand and breathe new life into the housing market.


g)      Enhancing Revenue Collection:

While it might seem counterintuitive, the reduction in stamp duty rates can result in increased revenue for the government. The potential uptick in property transactions could compensate for the lower tax rates, leading to a more dynamic and buoyant real estate market.


[ The Revenue (Stamp Duty and Registration) Department vide Cabinet meeting held on 29th November discussed the proposal to reduce the stamp duty under Mahaharashtra Stamp Duty Abhay Yojana 2023  and decided to implement it as follows:-

Maharashtra Stamp Duty Abhay Yojana 2023 is implemented in two phases in the State of Maharashtra.

PHASE I  - 1st December 2023 to 31st January, 2024.

PHASE II - 1st February, 2024 to 31st March, 2024.]


The referred  Abhay Yojana is valid only for the stamp papers sold by the Government  authorized stamp vendors/dealers or Chief Comptroller Revenue Authority shall apply to the following types of documents executed on stamp paper for any amount sold through a mechanism authorized by a competent authority subordinate to it:-


a)    Deed of Transfer and Sale Deed or Lease executed for the purpose of residential or non-residential or industrial use: Agreement of Sale, Promissory Note: A deed of title-an agreement relating to a deposit, pledge or mortgage.


b)    Deed of transfer of lease of immovable property intended for residential use as well as residential or non-residential plots allotted by the newly created Maharashtra Housing and Area Development Board and its Subordinate Divisional Boards (MHADA) and CIDCO or allotted to the slum holder for rehabilitation under a scheme approved by the Slum Rehabilitation Authority and deed of transfer of flats as well as deed of transfer of residential or non-residential plots and flats in registered co-operative housing societies pending for voluntary transfer.


c)    A deed of development agreement executed in pursuance of the redevelopment of such immovable property, which is dilapidated or otherwise required to be redeveloped, or of its sale or transfer or authorization to the concerned developer.


d)    articles and deeds in respect or amalgamation or reorganization of companies;


e)    Newly created Maharashtra Housing and Area Development Board and its Subordinate Divisional Boards (MHADA), City and Industrial Development Corporation Maharashtra Limited, various types of deeds executed through authorities like Maharashtra Industrial Development Corporation, Slum Rehabilitation Authority, etc.


In opinion of the decision, the following approval is given in connection with remission of stamp duty and penalty in the pending cases for recovery of stamp duty and  penalty under various section of the Maharashtra Stamp Act:-


The following exemptions and reliefs shall apply to the full stamp duty payable and recoverable in respect of documents executed between January 1, 1980 and December 31, 2000, but not filed or registered.

I.          In the first phase of the scheme:- 1st December 2023 to 31st January, 2024.


Amount of stamp duty to be paid

Exempted percentage of stamp duty

Exempted percentage of penalty

Rs1/- to Rs1,00,000/-

100%

On the entire stamp duty actually payable and recoverable -100% exemption should be provided in the applicable penalty.

Rs.1,00,001/- and above

50%

100% exemption should be given in the penalty applicable on the entire stamp duty actually payable or recoverable.

II. In the second phase of the scheme:- 1 st February, 2024 to 31st March, 2024.


Amount of stamp duty to be paid

Exempted percentage of stamp duty.

Exempted percentage of penalty.

Rs1/- to Rs1,00,000/-

80%

On the entire stamp duty actually payable and recoverable -80% exemption should be provided in the applicable penalty

Rs.1,00,001/- and above

40%

70% exemption should be given in the penalty applicable on the entire stamp duty actually payable or recoverable.

2) The following exemptions and reliefs shall apply to the full stamp duty payable and recoverable in respect of documents executed during the period January 01, 2001 to December 31, 2020 but not filed or registered.


I. In the first phase of the scheme:- 1 st December 2023 to 31st January, 2024.


Amount of stamp duty to be paid

Exempted percentage of stamp duty.

Exempted percentage of penalty

Rs1/- to Rs 25,00,00,000/- (upto Rs.25 Crores)

25%

a) If the outstanding penalty is less than Rs.25,00,000/- (Rs25 lakhs) then 90% exemption will be applicable. b) If the outstanding penalty is more than Rs.25,00,000/-(Rs. 25 lakhs) then only Rs.25,00,000/- will be payable(rest will be exempted).

Rs. 25,00,00,001/- and above (more than Rs.25 Crores)

20%

Rs 1,00,00,000/-(Rs.1crore) penalty will be applicable(rest will be exempted)


II. In the second phase of the scheme:- 1 st February, 2024 to 31st March, 2024.


Amount of stamp duty to be paid

Exempted percentage of stamp duty.

Exempted percentage of penalty

Rs1/- to Rs 25,00,00,000/- (upto Rs.25 Crores)

20%

a) If the outstanding penalty is less than Rs.50,00,000/- (Rs50 lakhs) then 80% exemption will be applicable. b) If the outstanding penalty is more than Rs.50,00,000/-(Rs. 50 lakhs) then only Rs.50,00,000/-(Rs.50 lakhs) will be payable(rest will be exempted).

Rs. 25,00,00,001/- and above (more than Rs.25 Crores)

10%

Rs 2,00,00,000/-(Rs.2crores) penalty will be applicable(rest will be exempted)

The decision to reduce stamp duty under the new amnesty scheme reflects a forward-thinking approach by the government to navigate economic challenges. By prioritizing affordability and fostering growth in the real estate sector, this initiative sets the stage for a more resilient and vibrant economy. As stakeholders adapt to these changes, the impact of reduced stamp duty is poised to resonate positively across various facets of the economy, ultimately creating a winwin scenario for both the government and its citizens.


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