The Maharashtra government has announced an Abhay Yojana (amnesty scheme) for the penalty that can be levied for insufficient or non-payment of stamp duty. This scheme is a periodic government initiative to provide relief to individuals and entities by granting a waiver on unpaid or deficient stamp duty and the applicable penalties.
Stamp duty is an integral part of any immovable property transaction that requires registration. The transaction could be either a sale, mortgage or lease of immovable property. For any of these transactions, adequate stamp duty has to be paid, and the document should be registered at the office of the concerned sub-registrar.
Before delving into the details of the amnesty scheme, it is essential to learn about the consequences of non-payment of stamp duty. More specifically, if the stamp duty is not paid on any particular transaction, the transaction document may not be allowed as evidence in any legal proceedings. Judicial authorities may also impound the document if you present it as evidence.
Besides, you are also charged a penalty which is calculated at 2% per month of the deficient stamp duty from the date of registration or execution of the document till the date on which you are making the payment. The maximum penalty that can be levied in such cases is 400%, which can turn out to be a large amount if a significant amount of time has elapsed since the document was executed.
If you have done a real estate transaction by paying stamp duty which is found to be deficient, then you can make use of this recent amnesty scheme to avoid any consequent penalty for it. This is also particularly useful for property dealings under the Maharashtra housing and area development authority (MHADA), city and industrial development corporation of Maharashtra ltd (CIDCO) and slum rehabilitation authority (SRA), for whom this scheme is applicable even if no stamp duty has been paid.
This latest Maharashtra stamp duty amnesty scheme or Abhay Yojana is operational for two months in the first phase (1 December 2023 to 31 January 2024) with a maximum reduction in penalty and for another two months in the second phase (1 February 2024 to 31 March 2024) with a lesser reduction in the applicable penalty. In this regard, the government resolution issued by the revenue and forests department clarifies that the amnesty scheme has separate relaxations in penalty for instruments executed between different decades, as explained below.
Instrument executed between 1 January 1980 and 31 December 2000 (inclusive of both dates)
Under phase-1 of the amnesty scheme, if the stamp duty due is up to Rs1 lakh, the entire amount and the entire applicable penalty would be waived off, provided that the applicant submits an application and self-attested copies of supporting documents on or before the last day as stipulated. However, if the stamp duty due is more than Rs1 lakh, 50% of it would be payable under the amnesty scheme, while the entire applicable penalty would be waived off.
If you miss the deadline under phase-1, you can still apply for amnesty under phase-2, for an 80% reduction in the payable stamp duty and an 80% reduction in the applicable penalty when the stamp duty due is less than Rs1 lakh. Similarly, if the stamp duty due is more than Rs1 lakh, there would be a reduction of 40% on the payable stamp duty and a reduction of 70% on the applicable penalty in this second phase.
Instrument executed between 1 January 2001 and 31 December 2020 (inclusive of both dates)
For instruments executed in these decades, when the applicant applies within the deadline specified in phase-1, the payable stamp duty can be reduced by 25% if the stamp duty due is up to Rs25 crore. In this case, if the penalty to be charged on the whole stamp duty or the payable duty is less than Rs25 lakh, then 90% of the penalty would be waived. On the other hand, if the penalty to be paid is calculated to be more than Rs25 lakh, then Rs25 lakh would be accepted as the payable penalty, while the rest would be waived off.
Under phase-1, if the stamp duty due is more than Rs25 crore, then 20% of it would be waived, and a penalty of Rs1 crore would have to be paid, while the rest would be waived off.
If the applicant misses the deadline under phase-1, they can still apply under phase-2 to avail of a lesser waiver on the stamp duty. During this second phase, 20% of the stamp duty would be waived if the amount due is up to Rs25 crore. Further, if the penalty due is less than Rs50 lakh, then 80% would be waived. On the other hand, if the penalty is calculated to be more than Rs50 lakh, an amount of Rs50 lakh would be accepted as payment, while the rest is waived off.
Under this second phase, if the stamp duty due is more than Rs25 crore, then 10% of it would be waived off, and a penalty of Rs2 crore would be accepted as payment, while the rest is waived off.
Payment of stamp duty under present amnesty scheme
Once you apply the prescribed form, either online or offline, along with self-attested copies of the requisite supporting documents, the concerned officer from the collector’s office will assess the application and issue a demand notice.
You are then required to pay the calculated deficient portion of the stamp duty and penalty, as applicable, within seven days from receipt of the demand notice. Failing to do so would result in losing the benefits of the amnesty scheme.
Once you pay the appropriate stamp duty as stated in the demand notice and show the proof of payment to the collector of stamps, you will receive the concerned sale deed or other instrument as the case may be, duly stamped, indicating full payment of the stamp duty.
If you face any difficulties with your application to the collector of stamps office, send us an email:
[email protected] or post your query on our Legal Helpline -
https://www.moneylife.in/lrc.html#ask-question You can also call (022) 35131664 on any working day to book an appointment with an expert counsellor of Moneylife Foundation, who hosts a guidance session on every Wednesday between 3pm and 6pm at our office in Prabhadevi in Mumbai.
