Why should legal documents be executed on Stamp Paper?
Documents, when executed on stamp paper of the prescribed value, are valid and legitimate. Documents that are properly stamped are proper legal documents and can be admitted as evidence by the court. A document inadequately stamped is liable to be impounded and penalties imposed. Thus, various agreements, affidavits, deeds, certificates, bonds, etc need to be executed on stamp papers in order to make them credible in the eyes of law.
In the conventional method, a lawyer would be required to draft a document and then print the same on stamp paper of due value. The Legal Capsule now eliminates the middleman, by employing user friendly technology which allows you to obtain legal documents effortlessly over the internet. Now you can create your own legal documents within minutes. Visit http://www.thelegalcapsule.com to know more.
Stamp Duty is paid to the Government by purchasing of stamp paper. Stamp duty is a duty levied on the legal recognition of certain documents. Thus, for every legal document executed, a certain percentage goes to the Government as Stamp duty. Stamp duty is payable under Section 3 of the Indian Stamp Act, 1899. The punishment and penalty for stamp duty evasion may vary from state to state.
Thus, the most common way to pay stamp duty is by purchasing non-judicial stamp paper from a licensed vendor, i.e., using papers bearing impressed stamps.
Here, it is important to note that there are two types of stamp papers (‘Judicial’ and ‘Non-judicial’) in use in our country. Non-judicial stamp papers are generally used for documentation, in legal documents like power of attorney, sale deed, rent agreement, affidavits, transfer of immovable property like building, land, mortgage or other important agreements etc. At present the non-judicial stamp papers of value Rs. 5, Rs. 10, Rs. 20, Rs. 50, Rs. 100, Rs. 500, Rs. 1000, Rs. 5000, Rs. 10000, Rs. 15000, Rs. 20000 and Rs. 25000 are available. Stamp duty for Non-Judicial Stamp Paper is paid under The Indian Stamp Act, 1899. On the other hand, judicial stamp paper, commonly known as ‘court fee stamp paper’, is used for a legal purpose or for court cases. The judicial stamp papers are used for payment of court fee in the court to avoid cash transactions. Stamp duty paid for Judicial Stamp Paper is paid under the Court Fees Act, 1870.
There are also two types of stamps, ‘Impressed’ and ‘Adhesive’ stamps. Impressed stamps include labels that are affixed/ impressed by an officer and can also be a stamp that is embossed or engraved on Stamp paper. Adhesive stamps, on the other hand, are suitable labels that are simply stuck on documents. They are further classified as postal and non-postal stamps. For documents, impressed stamps are the ones in common use.
Other methods of paying stamp duty include ‘e-stamping and ‘franking’.
The e-stamping is a Web-based, secure, tamper-proof system. Aimed at replacing conventional registration methods, authorised stamping centres collect the payment for stamp duty and issue stamp certificates. The stamp certificate generated by the system comes with a unique identification number that can be verified online. The Stockholding Corporation of India has been authorised by the Centre to act as the central record keeping agency for the e-stamping project. However, only few states in India offer e-stamping facilities. Under the franking method, the document for which stamp duty is to be paid is printed on plain paper. This paper is submitted to an authorised bank, which processes the documents through a franking machine. However, franking machines are not available at all bank branches and there are no uniform rules for authorised franking agencies. Hence the drawback in franking is that it could result in difference in rules among states and even among different banks within the same state.
To create your own legal documents printed on Stamp paper-
Visit our website http://www.thelegalcapsule.com
Pick which document you want to create, from our preset list, and fill in your details.
Review your document once completed.
Download and print the prepared document on stamp paper. Or Opt to have documents printed on Stamp paper and delivered to an address of your choice.