Stamp paper denomination for gifting shares
Adityakumar Jain
(Querist) 25 May 2017
This query is : Resolved
Dear Experts,
Our real elder brother & sister will be, by executing Gift Deed, Gifting Shares to us (i.e. to their real younger sisters & brother).
My Query:
(a) What should be the appropriate denomination of Stamp Paper to be use to execute Gift Deed?
(b) Is there any amount slab based on which denomination of Stamp Paper for executing Gift Deed is decided?
(c) I would be much obliged to inform me the relevant provision of law which decides the denomination of Stamp Paper for executing Gift Deed?
Sincerely,
Aditya kumar Jain.
Guest
(Expert) 25 May 2017
It Varies from State to State
Guest
(Expert) 25 May 2017
Better confirm it with the concerned Registrar Office it self to avoid hurdles
Guest
(Expert) 25 May 2017
Senior Document Writers at concerned Registrar Office also could guide you and they would even get the Gift Deed Drafted for you.
Guest
(Expert) 25 May 2017
All the Best
Rajendra K Goyal
(Expert) 25 May 2017
Stamp fee varies from state to state, you can find out in case of your state.
This is gift of shares, it would be better to consult your broker / depository / concerned company to know full procedure.
There are possibility that registered gift deed need not be executed. No need to pay stamp fee like gift deed in case of property.
Guest
(Expert) 25 May 2017
Agree with MR.RK Goyal
Guest
(Expert) 25 May 2017
But there is No Possibility that " No Need To Register A Gift Deed
Guest
(Expert) 25 May 2017
All Documents including Gift Deed Must be Registered
Guest
(Expert) 25 May 2017
There might be some exemption in stamp duty in some states for Gift Deed Registration
Guest
(Expert) 25 May 2017
But Registration is mandatory
Guest
(Expert) 25 May 2017
How there could be any Legal Value with out Registration
Guest
(Expert) 25 May 2017
Any Unregistered Documents will have No Legal Value in Courts
Guest
(Expert) 25 May 2017
Better Not to Misguide the Innocent Querist Please
Guest
(Expert) 25 May 2017
It is only my humble Request Please
Guest
(Expert) 25 May 2017
Do Not Mistake Please
Kumar Doab
(Expert) 25 May 2017
The equity shares are in DEMAT or Paper Form.
Kumar Doab
(Expert) 25 May 2017
Check with DP for procedure and charges for such gift.
A simplified procedure may also be available.
Kumar Doab
(Expert) 25 May 2017
If the transaction value is high it is good to register the gift deed.
kavksatyanarayana
(Expert) 25 May 2017
to the best of my knowledge, in most of the states there is no gift deed or form for shares but it is transfer of shares and stamp duty to be paid at 0.25% on the value. However as advised by the above experts, the duty is vary from state to state. so please check with the company and also in District Registrar office.
Rajendra K Goyal
(Expert) 26 May 2017
Expert kavksatyanarayana ji,
For physical shares the transfer fee need to be paid @.25%.
For demat account such fee is not to be paid.
The fact of gift can be recorded through a simple letter accompanying the offline transfer slip of the share in demat account.
Adityakumar Jain
(Querist) 26 May 2017
Dear Experts,
Thanks to all for your valued opinions.
Shares are in physical form not demated yet.
It is true that Gift Deed is not require for transfer of Shares. But, for Income Tax point of view it have importance, I suppose. In its absence department may consider transfer as trading and if those Shares sell in market within 12 month they consider it as Short Term Capital Gain and charge Tax on it. Therefore to avoid this situation, Gift Deed is of importance. [Relevant provision of Income Tax Act to me are:- S-2 (29A), S-2 (42A), S-47 (iii), S-56 (2)(vii)(c), S-2 (42A) Explanation (i)(b) & S-10 (38).]
Therefore I want to know about denomination of Stamp Paper on which such Gift Deed should be executed. Whether of Rs. 100 or 200 or 500 or else.
Thanks to all for your valued time given.
A K Jain.
Guest
(Expert) 26 May 2017
You could also Discuss this CA Club of this Same Forum
Guest
(Expert) 26 May 2017
Agree with Mr.RK Goyal Ji
Guest
(Expert) 26 May 2017
Well Advised Please
Guest
(Expert) 26 May 2017
Mr. Aditya Kumar Jain,
Your original question is with reference to the legal documents in combination with the Indian Stamps Act, not in connection with the Income Tax laws, as you raised some doubt with reference to the I.T.Law, or the property laws.
So far as the gift deed is concerned that falls within the purview of the Transfer of Property Act.
So, at first, you have to decide, for what purpose and with reference to the implications of which law you want to have guidance, i.e., the property laws, Stamps laws, or the Income Tax laws, as implication of each law is quite different.
So, if you want appropriate guidance with particular reference to all the aforesaid laws in combination, you may better get personal consultancy from some expert by providing complete description/details of the case, including the market value of shares to be transferred, as gift.
However, for your information, the shares being classed as movable property you have both the options, either to transfer physically by handing over in person or through a registered gift deed. Stamp duty for transfer of shares and stamp duty for registered gift deed are quite distinct from each other and apply on the nature of transaction & transfer differently.
Notwithstanding the transfer of shares or gift deed, application of income tax law is quite distinct and independent from each of the above cases, as that is based on the consideration of the earned or unearned income.
Implications of all the three laws being different, nothing can be mixed up with the nature of each transaction.
Kumar Doab
(Expert) 26 May 2017
Have you checked with DP for procedure and charges for such gift and simplified procedure may also be available!
Kumar Doab
(Expert) 26 May 2017
Your own local I Tax counsel,CA, Financial Planning Consultant etc of unshakable repute and integrity can also advise you in person in detail of all maters that you may have.
If you are regular or known he/she may not even charge you some FEE.
Kumar Doab
(Expert) 26 May 2017
As suggested above also you can post at sister website of LCI:
www.CAclubindia.com
and you will get advise FREE.
Kumar Doab
(Expert) 26 May 2017
Online discussions have its own limitations and one should go back to one's own counsel of unshakable repute and integrity specializing in respective field of law and one's own can also advise in person in detail.
There are many entities that loiter at online portals like LCI to allure unsuspecting querists, and fleece them.
Many of such entities have even claimed IT shall see how FEE that is once paid can taken back from IT.
