By its Circular dated 14th July, 2023 bearing reference no. Stamp-2022/pra.Kra.617/M-1 (Policy) the Revenue and Forest Department, Government of Maharashtra ("Circular") has addressed the concerns revolving around stamp duty payable on agreements between the registered co-operative housing societies ("Society") and its existing members, in case of self-redevelopment projects.
On the recommendation of the High Level Committee, the Housing Department of Maharashtra has passed an Order on 13th September, 2019 ("2019 Order"). Point 9AA of the 2019 Order states that since there is no third beneficiary in a self-redevelopment scenario, the agreement executed between the Society and its existing members must be stamped with a value of Rs.1000/- in accordance with the Pradhan Mantri Gramin Awas Yojana and the new units forming part of the re-developed building must be stamped in accordance with the provisions of The Maharashtra Stamp Act, 1958 ("Maha. Stamp Act").
In accordance with the decision held in the 2019 Order, where self-redevelopment is being undertaken by a Society (whether standing on government/ semi-government/ private lands) inter-alia the following clarifications have been provided under the Circular:
- The stamp duty payable on the Allotment Letter/ Agreement executed between the Society and its existing members, shall be Rs.1,000/- (Rupees One Thousand only);
- The stamp duty payable on the new units/ apartments which are to be sold in the open market shall be as per the provisions of Maha. Stamp Act;
- If a member of the Society purchases an area in excess of the area of the existing unit, the stamp duty payable on such excess area shall be as per the provisions of the Maha. Stamp Act;
- The stamp duty payable on the Works Contract executed between the appointed contractor and the Society shall be as per the provisions of the Maha. Stamp Act;
- The Agreement executed between the Society and its existing members shall have the Share Certificate of such existing member or a Certificate from the Chairman/ Secretary confirming that such person is the existing member of the society, annexed to it;
It is important to note that the benefits stated under the Circular are applicable from the date of the Circular and for the stamp duties paid by existing members prior to the date of the Circular, no refund shall be initiated.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.