Stamp Duty and Registration Charges in India - Calculation & Process (Hindi) - YouTube

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Hello, my name is Mukul

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Whenever you buy a property

You have to register it compulsorily

For that, you have to pay stamp duty and registration charge

There are other types of legal documents in which you have to pay a stamp duty

Whenever a property is transferred or a rights is transferred

From person one to person two

So what is stamp duty and how is it calculated?

In which documents do we have to pay stamp duty?

And sometimes there is the confusion that

At which rate do we have to pay stamp duty

At circle rate or the market value

What is the difference between the two?

How can you pay stamp duty?

These are the questions whose answers

We can not find online easily

I've put all these details in this video

I will explain everything in detail

So that all your concepts will be cleared

Do watch the video from start to finish

So that you will not miss any important point

Let's go straight towards the blackboard

So firstly we will understand what stamp duty is and why we have to pay it.

We will understand this with the help of an example

Assume you want to buy a property

And A is the seller, he is the owner

And assume you are B, a buyer

And assume the transaction value between you is 1 crore

So you'll give 1 crore Rs to the seller

And after getting the money

He will hand over the property to you

He will give you possession

This whole transaction

Is executed through a document

Generally, we call it a sale deed

If it is normal selling

Then we call it a sale deed

But the property can be transferred in different ways

Assume if there is not any money involved then it can be exchange deed also

It is can also be a gift deed if someone has gifted the property

What happens in these cases is that

You have to register for this deed

Whatever deed you are signing, whatever agreement you are signing

And you have to pay stamp duty and registration charges

In sub-registrar office for getting it registered

When you register it by paying stamp duty and registration fee

Then only the property is considered legally valid

Otherwise, it is not considered a legal transfer

Some people get it transferred

By different documents

It is very important to register every document

And registration is important

Because it will be proof

Assume you've lost your documents, then also you have a source to generate a copy

But if your original is lost and you don't get it registered

Then it will be very problematic for you if you don't have anything to prove your ownership

That's why paying stamp duty is very important

If we want to give the definition

That what is a stamp duty

So what stamp duty is, it is a type of government tax

That we have to pay on legal documents

Generally, we have to pay it on transfers of property and assets

As you are seeing in this case, the sale deed has happened here

So we must pay stamp duty and registration charges in this case

The stamp duty and registration charges

Are generally collected by the state

It is not collected by the central government, this is the matter of the state government

It is different in every state

It can be 4% in some states, can be 5%, it can be 5.5%, 7%,8%

It can be anything

It is generally up to 10% of the property value

In different states

It is different for lease property, different for selling property in different states

So these rates are different for everything

The governing act of this is the Indian Stamp Act, 1899

Under this act, this value is collected from you

This stamp duty has to be paid by the buyer or transferee

Assume there is a lease

So in this case, the right is transferred in a way

The person to whom the right is being transferred

Is known as transferee

In this case, in the case of selling

The buyer will be the transferee

Because all the rights are transferred to him

So we can call him transferee also

The registered document on which you have paid the stamp duty

In this case, assume it is a sale deed

This is a proper legal document. You can also produce it as

Evidence in the court

Assume you have bought a house and you have done its sale deed

And you want to prove your ownership if there is a case

Then you can produce its copy

And you can show it as original also

As a proper legal document

The second benefit of paying stamp duty and registration is

if you lost the documents, then in that case

You can make a duplicate copy

It will be considered a legally valid document

But if you haven't registered it and you lost the original

Then it will be quite difficult to prove the ownership

You have to pay stamp duty

at the time of execution of transfer agreement

Now, what is execution?

Execution means that

The day your document or sale deed was signed

The one on which you've paid the stamp duty

That day is considered as the execution date and you have to pay the stamp duty on the same day

So now we will see which type of other documents are there in which you have to pay stamp duty

We talked about the sale deed

When ownership of property is transferred then you have to give the stamp duty

And get it registered. Then you have to get the gift deed registered too

Assume if a relative gifts another relative a property or gifts asset

It is necessary to register it

The exchange deed is signed when the property is exchanged.

Then in that case exchange deed is signed and it is compulsory to register it

The partition deed is signed in the case where

Assume there are two children

And the property is being divided among them

Then partition happens there. And partition deed is signed and it is compulsory to register it

The lease deed is signed when someone gives

property or house on rent to someone

So when the lease is more than

12 months, only in that case the registration is compulsory

So you have seen that 11 months rent agreement is signed

It is not compulsory to register it

Generally, people notarise it

And that too is legally valid. So when a lease is signed for more than 12 months

Then it is compulsory to get it registered

Then there is your transfer deed of any type

Whenever a right is transferred, in that case also have to get it registered

Assume you have taken a loan from someone and mortgaged your property

So, in that case, you will sign a mortgage deed

So it is compulsory to register it

Then there is the power of attorney

Power of attorney can be a general power of attorney

It can be special power of attorney

So it is necessary to register it

In many cases, assume there is a right transfer

Something is transferred through this

Then you should get it registered

Now we will learn that how is the calculation of stamp duty

And registration charges are done?

So the stamp duty and registration charges vary from state to state as I have told you earlier

If we talk about the sale deed example when the ownership is being transferred

So in that case it varies from

4 % to 10 % of the property value

In some states, it can be 4%, in others, it can be 10%

We are talking about only stamp duty now

Registration charges are generally 1% of the property value

This is fixed in every state

But the stamp duty varies from 4 to 10%

Now the question that arises here is that how the property value is decided?

You may have heard many times that

Stamp duty is collected at the circle rate and sometimes you may have heard

The actual transaction value or market value as we call it is the amount on which the property was sold

So we will understand this case

And before that, if you want to know what is circle rate

And what is a guideline value?

The circle rate, if I write it here

Then in some states, we call it guideline value

And sometimes it is guidance value

Like in Tamil Nadu, it is guideline value

In Karnataka, we call it guidance value

In Mumbai and Maharashtra,

It is Ready Reckoner Rate

The concept is the same

But what is this, this a minimum rate decided by every state government

Below this, you don't have to do registration

Below this, you don't have to pay a stamp duty

This is the minimum rate on which you have to pay stamp duty

I have made separate videos to know them in detail

How are these rates decided?

Please watch these videos of mine

Now we will talk about

How is the calculation of stamp duty is done when you are getting a sale deed?

We will understand this in two cases

Assume, this is case one, this is not clear

So in case 1, assume the market value of the property

You have purchased a house in 1.5 crore

And maybe there is less circle rate

So in that case, on which amount do you have to pay stamp duty ?

As I have told you

The higher value out of the two values (circle value and market value)

You have to pay stamp duty and registration charge on that

So if we assume that 5% is made by adding registration charge and stamp duty

In that state, then on which amount do you have to pay?

You have to pay on the market value

The Higher of the two, in this case, is 1.5 crores

Then you have to give 5% of 1.5 crores

You have to give 7.5 lacs as stamp duty and registration charges

If we consider the second case, assume, the circle rate is 1 crore and the market value is less

Sometimes what happens is government do surveys and periodically update the circle rate

And the real estate market may go down and

The market value falls

So what happens, in that case, is assume the market value is 70 lacs

And circle rate is 1 crore

So, in that case, you have to pay stamp duty and registration on circle rate

Because circle rate is more in this case

So if we calculate 5% on 1 crore

Then you have to pay

5 Lakhs of stamp duty and registration charges

So I think that everything is

Cleared to you by this example

Stamp duty and registration charges are paid on higher of the two values

The stamp duty value of 4 to 10%

We get many rebates on that

It varies on different factors

What happens in urban areas, we have to pay a little bit more stamp duty

There are rebates in the rural area

Stamp duty is dependent on the type of property

Less stamp duty is collected on residential

Commercial, industrial, hotel, the places where commercial activities are conducted, have to give more stamp duty

In many states, it is also dependent on the gender

female owners get a rebate for example

If I give you an example of Delhi

Females have to pay 4% stamp duty

And it is 6% for the males

And if you buy a joint property then you have to pay 5 % stamp duty

In the same way, in some states, senior citizens get a rebate

I think you understood broadly how stamp duty and registration charges are collected

Now we will understand

How you can pay stamp duty

How does the government collect stamp duty?

So there are three main ways

The first way is you can buy non-judicial stamp paper

You may have seen the tigers on the stamp

Those types of stamps are there, they are of the old type

But nowadays there is also electric form

But those stamp papers are also available

You can buy stamp paper from any stamp paper vendor in your area

When you buy a stamp paper then you have to pay stamp duty at that time

After that, you can buy an e-stamp

In many states, it is available online

You can download the e-stamp by paying through RTGS or NEFT

The third method is a franking method

Many banks are authorized

You can go to any authorized bank

And print your agreement on plain paper

When you will pay your stamp duty

Then the authorized bank

Will process it with franking machine

You can also pay your stamp duty by this method

Stamp paper can be bought

In the name of buyer and seller

You have to get the

Sale deed registered within 4 months

After paying stamp duty

Or any other document other than the sale deed

Any day on which you've executed it

Then you'll pay the stamp duty on the same day on which you've signed it

It is necessary to get it registered within 4 months

Otherwise, it will be invalid

I think you've got the idea of what is stamp duty after watching this video

And why should we pay for it?

Why should we register any document?

What type of documents should we register?

How is stamp duty calculated?

And how can you pay stamp duty and how can you buy stamp paper?

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