All you need to know about e-stamping in India

Registration is a crucial step in any transaction. It legally warrants the transaction. It takes place on documents, called stamp papers, procured by paying the stamp duty. Among the different ways, E-Stamping is the safest and most convenient way to pay stamp duty. So, here's all that you need to know about E-Stamping in India.

What is Stamp Duty?

Before knowing E-Stamping, let's understand stamp duty.

Stamp duty is the tax levied by the Central or state Government (depending upon the nature of the transaction) under Section 3 of the Indian Stamps Act 1899 to register any document. It is either fixed or ad Valorem (based on the transaction's value).

There are two types of stamp duty- judicial and non-judicial. Judicial stamp duties are court fees, whereas non-judicial stamp duties are taxes on financial transactions.

How to pay stamp duty?

There are three ways to pay stamp duty:

  • 1.Non-judicial Stamp Paper:

    Non-judicial stamp papers are printed with revenue stamps denoting values like ₹10, ₹500, etc. These are used on non-judicial documents like affidavits, transfer of immovable property, etc., and can be brought from Government-authorized vendors.

  • 2.Franking:

    Franking is the process by which Government-licensed vendors impress marks similar to non-judicial papers on papers using a Franking Machine.

  • 3.E-Stamping:

    E-Stamping is the electronic way to pay stamp duties.

E-Stamping in India:

In the wake of numerous complaints of stamp-paper counterfeits and stamping-related scams, the Central Government of India (Ministry of Finance) launched the E-Stamping service in 2013 through the Stock Holding Corporation of India Limited (SHCIL). SHCIL is the Central Record Keeping Agency of India.

SHCIL facilitates you to pay stamp duties and download the stamp duty certificate at the comfort of their homes. SHCIL also maintains various Authorized Collection Centres where you can collect the certificate.

E-Stamping laws:

The Indian Stamp Act 1899 is the fiscal statute governing the stamp duties on the documents specified by List-I, Seventh Schedule of the Constitution of India.

However, stamp duty (on documents except those governed by The Indian Stamp Act 1899) is a state subject under Entry 63 of List II, Seventh Schedule, meaning respective states have the exclusive power to legislate their stamp duty statutes.

States offering E-Stamping:

Presently, E-Stamping functions in:

  • Andaman Nicobar Islands
  • Andhra Pradesh
  • Assam
  • Bihar
  • Chhattisgarh
  • Chandigarh
  • Dadra and Nagar Haveli
  • Daman and Diu
  • Delhi NCR
  • Gujarat
  • Himachal Pradesh
  • Jammu and Kashmir
  • Jharkhand
  • Karnataka
  • Odisha
  • Puducherry
  • Punjab
  • Rajasthan
  • Tamil Nadu
  • Tripura
  • Uttar Pradesh
  • Uttarakhand

E-Stamping vs. traditional methods:

Here's how E-Stamping beats the traditional methods:

  • 1.User-friendly:

    With E-Stamping, you can effortlessly pay stamp duties at your home, saving time and money spent on buying stamp papers by physically approaching the vendors.

  • 2.Pocket-friendly:

    E-Stamping can save your extra cost on stamp papers of higher denominations when the exact value is unavailable. You can frank the exact-valued stamp paper, but additional charges are applicable.

  • 3.Risk-free:

    Stamp papers are counterfeits-prone, and franking is not safer either. Remember the Telgi scam that astounded India in 2003? The scammers sold counterfeit stamp papers worth ₹20,000 crores! However, E-Stamping is tamper-proof, as the entire process takes place under the governance of SHCIL.

  • 4.Secured payment:

    E-Stamping enables the stamp duty to go real-time straight to the Government instead of middlemen like vendors, eliminating any chance of corruption.

  • 5.Certified:

    E-Stamps come with a certificate to authenticate the stamp duty. It is fool-proof, bearing a non-replicable two-dimensional bar code, watermarks, and a Unique Identification Number.

How to procure E-Stamps?

There are two ways to procure E-Stamps in India:

  • 1.Directly visit the SHCIL website,

  • 2.Contract Lifecycle Management (CLM) solutions. ,

E-Stamping through CLM:

CLM solutions providers can help you pay stamp duty by E-Stamping. They make the process easier for you by procuring the E-Stamps and the certificate directly from SHCIL for your documents.

Why CLM for E-Stamping?

Availing CLM solutions from trusted providers like The Legal Capsule has its advantages over procuring E-Stamps directly from SHCIL, and here's how.

  • 1.Comprehensive solutions:

    CLM manages your documents from drafting to E-Signing and E-Stamping and further storing and renewing them, helping you handle them from all aspects in one go. With CLM, say goodbye to personally and individually procuring E-Stamps and E-Signatures for your documents.

  • 2.Storage safety:

    There is always a fear of misplacing the E-Stamp certificate, which, unfortunately, is not re-issued. Thankfully, CLM enables you to securely store all your E-Stamped documents in a cloud-based system and retrieve them effortlessly.

In a nutshell, the best way to pay your stamp duties is E-Stamping. And E-Stamping through the CLM solutions of The Legal Capsule can relieve a lot of your paperwork headaches. So, next time you need document registrations, why not sit back and let The Legal Capsule do the job!

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