Yavanika Singh (Company Secretary) 07 September 2010

uNABLE TO CALCULATE STAMP DUTY ON LEASED PROPERTY

Dear Learned Members,

Hello everyone..

I am a new member & this is for the first time I am posting my query.. Looking forward for answers of the same.

I am working as a CS in a construction Company. We have constructed a mall and have given shops on lease to the vairous retails. As we all are aware that we have to pay stamp duty on lease. but here the problem is that our mall is situated in UP, and U.P. Stamp Act is applicalbe over here.

Now the problem is that the stamp duty is calcluated over the fixed rental for say Rs30/- @ 345 sq. ft. i.e. Rs. 10,350/- but we charing rent on the sale sof the retails or we say we have revenue share i.e we will charge 15% on the net sale.

Now the amount of net sale will vary month to month because this is not fix beacuse of which we are unable to calculate the mount of the stamp duty on the revenue share because the amount of rental is not fixed.

So, i request you to all please help me out ....as I am really stucked up in this problem?????

Regards

CS Yavanika Singh

Reply Follow

3 Replies

R.Ramachandran (Advocate) 07 September 2010

Dear Yavanika,

When you say that "stamp duty is calcluated over the fixed rental for say Rs30/- @ 345 sq. ft. i.e. Rs. 10,350/-", do you mean to say that the law in UP is such that irrespective of the lease rental charged by you, the Registry will calculate it adopt the lease rent as Rs. 30/- per sq.ft.? In other words it is the fixed circle rate.

In such case, whether you charge the lease rent either at sq.ft. rate or on the basis of revenue share, how does it matter? You have to pay the stamp duty as per applicable circle rate isn't it?

raj (Lawyer) 07 September 2010

I agree with Mr. Ramachandran.

R.Ranganathan (Advocate) 14 September 2010

As Mr. R.Ramachandran said there should not be a problem for you when there is a fixed rate fixed in U.P. Otherwise you ask whether there is any maximum rate in U.P. you can pay that amount, irrespective of the amounts received by you.

Otherwise state the exact U.P. stamp charges applicable for leases to give a proper opinion.