Q. 1. How much is stamp duty?
The Bombay Stamp Act, 1958 comes into force on 16th February, 1959 and is applicable in the State of Maharashtra. This Act is intended to levy Stamp duty on certain types of documents executed in the State or brought from outside for acting upon the same in the State. The various instruments/documents are broadly covered under different 62 articles listed in Schedule-I appended to the Act. The rates at which stamp duty is levied on these documents are mentioned in Schedule –I. The Bombay Stamp Act levies Stamp duty on documents/instruments by which any right or liability is, or purports to be, created, transferred, limited, extended, extinguished or recorded. The stamp duty is payable on instrument and not on the transactions.
Q. 2. What is Stamp Duty ?
It is a type of tax which is paid for the transaction performed by way of document or instrument under the provisions of Bombay Stamp Act, 1958 and Indian Stamp Act, 1899.
Q. 3. Whether Stamp duty is payable on transactions or on instruments ?
It is payable on instruments and not on transactions. The definition of the term instrument is very wide.
Q.4. How much is Stamp duty?
Stamp duty depends upon valuation of documents.
Q.5. What point of time of Stamp Duty payable ?
The Section 17 & 18 of the Act states the time of payment stamp duty. Generally all the instruments executed in the state shall be stamped before or at the time of execution or immediately thereafter or on the next working day following the day of execution. Similarly, the instrument which is executed out of the state and within three months from its receipt in the state, shall be stamped.
Changing the form of business organization reflects the attitude of the management for moving towards a better management system. The decision to change business organization is very important and therefore, it is necessary to undertake a detailed analysis of the decision before executing the same. The factors, governing the decision to convert will depend upon the existing organization and objective of the management.
Possible options of conversion are outlined below:
Conversion into Company
Conversion in to Limited Liability Partnership
There can be following two ways of converting Partnership into Company
- Filling an application with the Registrar of Companies for registering itself as company under Part IX of the Companies Act 1956.
- Incorporating a company and thereafter selling the entire business of partnership to it.
Management may consider the option of Business Conversion to meet requirements of:
Limit the Liability of Owners
Infuse funds into the business
What are the minimum requirement requirement for Converting Partnership into Private Company?
Assent of majority of its members as are present in person or where proxies are allowed, by proxy, at a general meeting summoned for the purpose of registering the firm under Part IX of the Companies Act, 1956. Since the liability of the members of the firm is unlimited, when a firm desires to register itself as a company under Part IX as a limited company, the majority required to assent as aforesaid shall consist of not less than ¾ of the members as are present in person or where proxies are allowed, by proxy, at a general meeting summoned for the purpose.
- To authorize one or more partners to take all steps necessary and to execute all papers, deeds, documents etc. pursuant to registration of the firm as a Company.
- To execute a supplementary Partnership Deed to align it with the requirements as under:
- There must be at least 7 partners in the partnership firm;
- The firm may be registered with the Registrar of Firms;
- There must be a fixed capital divided into units ;
- There must be provision of converting a firm into company.
- There must be an agreement by the partners to convert the partnership to a company.
- Execute a settlement deed.
Real Estate Documentation –Drafting of agreements pertaining to immovable property also called as CONVEYANCING.The word “CONVEYANCING” means transfer of property inter- vivos i.e. between two living persons. Conveyancing is an art of drafting deeds and legal documents whereby any right, title or interest in tangible immovable property is transferred from one person to another. Conveyancing is not just an ordinary art but it is thoroughly based on legal knowledge and principles evolved over the years. The term conveyancing is restricted to deeds and documents concerned with the transfer of property; whereas drafting carries a general meaning that of preparing any legal documents or deeds or any other business oriented documents. It means absolute transfer of tangible immovable property by the vendor to the purchaser by entering into a contract for sale wherein both the parties will settle the terms and conditions of transfer. Such transfer can be done through the registered document and thus delivery of the property can be by handing over the actual possession of the immovable property by the vendor to the purchaser or the person legally authorised by him. In a sale of tangible immovable property, all the statutory rights i.e. easementary rights, beneficiary rights, actionable claims as well as vested interest in the immovable property will be transferred in-toto in favour of buyer from the vendor.
What are the various services provided we provides relating to transfer of real estate/ Immovable Property?
- Drafting & Registration of Sale/ Purchase Deed
- Drafting & Registration of Development agreement
- Drafting & Registration of Rent Agreement
- Drafting & Registration of Lease Deed/ agreement
- Drafting & Registration of Assignment agreement
- Drafting & Registration of Arbitration agreement
- Drafting & Registration of Gift Deed
- Drafting & Registration of Mortgage Deed
- Assist in clearing Title of Documents.
- Opinion & Consultancy regarding existing agreement
- Review of Agreements
Compliance applicable to Indian Company?
Once Company is registered, whether Private or Public Company. Its mandatory for that company to file periodical returns/ information document, Maintenance of Statutory Books, conducting Meetings as well as event base returns to the Registrar of Companies (ROC), Income Tax Department, Service Tax Department etc. We can outline the some of the Minimum Mandatory Compliance as well as the Event Based Compliance applicable to a Private/ Public Limited Company towards Registrar of Companies.
Regular/ Periodical Compliance For Company
- Obtaining/ Renewal of Digital Signature Certificate (DSC) on expiry
- Conducting Quarterly Board Meetings
- Conducting & reporting Annual General Meeting (AGM)
- Annual Filing/ Annual Returns of Financial Statement to ROC
- Yearly forms by directors regarding Disclosures
- Maintenance of Statutory Register & Minutes Book
Event based Compliance relating to reporting or Recording of Transaction under Company Law:
- Inform ROC about Increase in Share Capital
- Inform ROC about Change in Object, address, Memorandum and Articles etc.
- Inform ROC about Allotment of shares
- Recording in Statutory Books Transfer of shares
- Inform ROC about Appointment/Resignation of directors
- Inform ROC about Appointment of Managing Director/ Whole Time Director
- Executing agreement with related parties
- Inform ROC about Change in the Bank signatories
- Inform ROC about Change in the statutory auditors
What will happen if compliance not done?
Above mentioned are only examples and the list is exhaustive. If Compliance are not made within the time frame given under Companies Act, 2013 may attract penalties as well as imprisonment in some of the cases. So far as penalties are concern in certain cases it may cost payment of penalties 12-14 times of normal fees of filling also. For further query contact us.