Stamp Duty Payable on Share Purchase Agreement in Delhi
When it comes to buying or selling shares, one of the key legal documents involved is the share purchase agreement. This document lays out the terms and conditions of the transaction, including the purchase price, the number of shares being bought or sold, and any warranties or representations made by the parties involved. However, one important consideration when drafting a share purchase agreement is the stamp duty payable on it.
In Delhi, the stamp duty payable on a share purchase agreement is determined by the Indian Stamp Act of 1899. Under the Act, the stamp duty payable on a share purchase agreement depends on the value of the shares being bought or sold. The rate of stamp duty varies from state to state, but in Delhi, it is 0.075% of the total value of the shares.
For example, if the value of the shares being bought or sold is Rs. 10,00,000, the stamp duty payable on the share purchase agreement would be Rs. 750. This amount is payable at the time of execution of the agreement.
It is important to note that stamp duty is a state subject and varies from state to state. Therefore, if the transaction involves shares of a company registered in another state, the stamp duty payable may be different. In such cases, it is advisable to seek professional advice and consult the relevant laws.
Failing to pay the appropriate stamp duty can lead to legal consequences, such as the document being declared invalid or being deemed as inadmissible as evidence in court. Therefore, it is important to ensure that the stamp duty payable on the share purchase agreement is calculated and paid correctly.
In conclusion, the stamp duty payable on a share purchase agreement in Delhi is determined by the value of the shares being bought or sold and is 0.075% of the total value of the shares. It is important to pay the appropriate stamp duty at the time of execution of the agreement to avoid any legal consequences. If in doubt, seek professional advice and consult the relevant laws.
