Maharashtra brings Limited Liability Partnership, Joint Venture under Partnership Act

The move is expected to impact JV investments, especially in the realty sector

Partnership instruments will now attract stamp duty on the market value of the property being transferred, according to the provisions of the Maharashtra Stamp (Amendment) Bill.

The provisions of the Bill, presented in the legislature, would also be applicable to limited liability partnerships and joint ventures. This is expected to impact joint venture investments, especially in the realty sector as project costs would shift up.

Transfer of development rights (TDR) documents are also likely to be affected, as the stamp duty would now be payable on the market value of property. Earlier, it was three per cent of the consideration amount.
 

The state government has also proposed a hike in stamp duty to 400 per cent from the current 200 per cent for less payment and included a clause whereby stamp paper worth Rs 500, instead of Rs 100, will be needed for any document.

Individuals, institutions, organisations, companies or bodies responsible for creating, executing, maintaining, recording and verifying an instrument chargeable with stamp duty will have to now furnish information on to stamp duty payment to the authority concerned. Officers will be entrusted with powers to inspect, seize and impound the chargeable instruments

If any person prevents or obstructs the entry of any officer to give any reasonable assistance, he or she, on conviction, will be punished with imprisonment for one month which can be extended up to six months and be fined with Rs 2,500.

A revenue department official told Business Standard, “The Bill has been moved to streamline the procedural aspects in the administration and also to bring simplicity and uniformity in levy of stamp duty.” The official said the clause has been inserted to bring rationality in the rates of stamp duty on the instrument of transfer of tenancy right and on the instrument of transfer of lease.

According to the official, the stamp duty on certain instruments, decided long ago at nominal amount of Rs 100 or Rs 200, will be increased rationally. The upper limit of stamp duty on the instrument of works contract will also be raised.