2012 (7) TMI 1167 - HC - Indian Laws

Summary

Issues involved: Whether stamp duty can be collected on increased authorized share capital u/s Indian Stamp (Delhi Amendment) Act, 2007.

Judgment Summary:

Issue 1: Stamp Duty on Increased Authorized Share Capital

1. The appeal challenged a judgment regarding the collection of stamp duty on increased authorized share capital under the Indian Stamp (Delhi Amendment) Act, 2007.

2. The company increased its authorized share capital from Rs. 3.50 crores to Rs. 125 crores, leading to a dispute over stamp duty payment.

3. The court analyzed Article 10 of Schedule IA of the Act, noting a deficiency in its wording regarding stamp duty calculation.

4. It was observed that the stamp duty payable on the Articles of Association of a company should be 0.15% of the authorized share capital, subject to a monetary ceiling of Rs. 25 lakhs.

5. The court found no provision in the Act permitting levy of stamp duty on the increase in authorized share capital, emphasizing strict construction of fiscal statutes.

6. Comparison with other states showed the necessity of specific statutory provisions for imposing stamp duty on increased authorized share capital.

7. The court highlighted the absence of such a provision in Delhi's Stamp Act, requiring an amendment to authorize stamp duty on increased authorized share capital.

8. Ultimately, the appeal was dismissed, upholding the judgment that no legal basis existed for imposing stamp duty on increased authorized share capital without a specific statutory provision.