G.O. (Ms.) No. 47, Reduction of Stamp Duty for Company Amalgamation or Reconstruction, 2020
The Government of Tamil Nadu, Commercial Taxes and Registration (J1) Department, issued G.O. (Ms.) No. 47 on 19 February 2020 to give retrospective effect from 1 April 1956 to reduced stamp duty for property transfers under company amalgamation or reconstruction schemes. The notification supersedes the Commercial Taxes and Registration Department notification published on 1 March 2019 and extends eligibility to schemes sanctioned by the High Court or the National Company Law Tribunal.
What the government order does
G.O. (Ms.) No. 47 of the Commercial Taxes and Registration (J1) Department makes the stamp duty reduction for company amalgamation or reconstruction schemes effective retrospectively from 1 April 1956. Schemes already sanctioned by the High Court or the National Company Law Tribunal can therefore qualify for the reduction.
The 2019 government order referred to in G.O. (Ms.) No. 47 had reduced stamp duty and registration fees for instruments transferring property in connection with company amalgamation or reconstruction. The notification issued on 19 February 2020 specifically sets out the reduced stamp duty and its retrospective application.
Who may be affected
G.O. (Ms.) No. 47 is relevant to companies transferring property under an amalgamation or reconstruction scheme sanctioned by the High Court or the National Company Law Tribunal. It may also be relevant to property owners, buyers, company advisers and registration professionals examining title documents created under such schemes.
Stamp duty and valuation rules
The notification appended to G.O. (Ms.) No. 47 provides that:
- Stamp duty is two percent of the market value of the immovable property or 0.6 percent of the aggregate market value of the shares, whichever is higher.
- Immovable property is valued at the amount stated in the scheme. If the scheme does not state a value, the guideline register prevailing on the date when the scheme was sanctioned applies.
- Immovable property situated outside Tamil Nadu is not charged under the notification.
- Unlisted company shares are valued at the amount stated in the scheme. If no value is stated, the value shown in the audited balance sheets filed with the Registrar of Companies immediately before the scheme was sanctioned applies.
Principal and subsequent instruments
G.O. (Ms.) No. 47 addresses cases where the same companies later execute another instrument solely to put the scheme terms into writing.
- If the subsequent instrument has been duly stamped at the specified duty, the principal amalgamation or reconstruction instrument is treated as duly stamped.
- If the principal instrument has been duly stamped at the specified duty, the later instrument executed solely to record the scheme terms is treated as duly stamped.
These provisions avoid requiring the specified duty to be paid again on both instruments where the conditions are met.
This summary is generated from the source document to help you find what is relevant. The PDF above is authoritative. For advice on your own property, use LandLens One or speak to a qualified professional.
Common questions
Does the stamp duty reduction apply to an amalgamation scheme sanctioned before 19 February 2020?
Yes. G.O. (Ms.) No. 47 gives the reduction retrospective effect from 1 April 1956, including schemes already sanctioned by the High Court or the National Company Law Tribunal.
How is Tamil Nadu immovable property valued if the scheme gives no market value?
The market value is taken from the guideline register prevailing on the date of the order sanctioning the amalgamation or reconstruction scheme.
Is stamp duty charged under this notification on property outside Tamil Nadu?
No. Immovable property situated outside Tamil Nadu is not subject to duty under the notification.
How are shares in an unlisted company valued when the scheme states no value?
The value is taken from the audited balance sheets filed with the Registrar of Companies immediately before the date when the scheme was sanctioned.
