The instant article is written to serve as reference material on the Stamp Duty Rates on the Partnership Agreements and the LLP Agreements. It is noteworthy that the partnership deed/agreement and the LLP agreements are subject to the same rate of the stamp duty in India. State governments prescribe the stamp duty rates; hence it varies across several states in India, and an attempt is made to gather the stamp duty rates on the partnership or LLP agreements at one place.
Disclaimer: The law being a dynamic subject that changes frequently, the setindiabiz or the author does not take any responsibility of the updates and request the reader to co-relate with the respective state legislation on LLP Agreement Stamp Duty.
The need and purpose of LLP Agreement
The LLP agreement is a written document, that is regarded as the constitution of the LLP and defines the relationship between the partners of the LLP per se and their relationship with the LLP. The LLP agreement should be printed on plain paper, and the stamp duty on the LLP agreement must be paid by way of purchasing the non-judicial stamp paper of appropriate value. Please refer to the below section to know the stamp duty rate in your state.
As per section 23 of the LLP Act, it is mandatory to file the LLP Agreement with the ROC within 30 days of its incorporation in FORM-3. The roc will object to the registration of LLP agreement if the same is not executed on correct stamp duty. Notary attestation of the LLP agreement is also desirable. The LLP agreement is a crucial document, and you should be very careful while calculating the stamp duty on the LLP agreement, as any short payment of the stamp duty would make the LLP agreement an unenforceable in the court of law. The purpose to define the role of partners, their mutual rights and obligations apart from the capital and profit-sharing ratio.
The LLP Agreement can be further amended or completely changed with the consent of all the partners of the LLP. In case of an amendment of the partnership deed or the LLP Agreement, you don’t have to pay the stamp duty as prescribed for the creation of the firm or LLP, but regular stamp duty which is leviable on a general agreement. However, kindly see the relevant stamp Act of the particular state.
Contents of the LLP Agreement & Draft Format
The Stamp Duty on LLP Agreement
As discussed in the above paragraphs, the LLP must pay the appropriate stamp duty on the LLP Agreement or the Partnership Deed. The manner of payment of stamp duty is offline, and the stamp duty liability is discharged by purchasing the non-judicial stamp paper from the designated stamp vendor.
| No. | State | Law of Stamp Duty | Capital – 50K | Capital – 1 Lakh | Capital – 5 Lakh | Capital – 10 Lakh |
|---|---|---|---|---|---|---|
| 1 | Andhra Pradesh | 100 for capital 5000, Rs. 500 for other cases | 500 | 500 | 500 | 500 |
| 2 | Arunachal Pradesh | Capital is upto Rs. 1000 – Rs. 30 Otther cases Rs. 100 | 100 | 100 | 100 | 100 |
| 3 | Assam | Capital is upto Rs. 1000 – Then Rs. 20 Above Rs. 1000 – Rs. 100 | 100 | 100 | 100 | 100 |
| 4 | Bihar | If capital disclosed then 2.5% Maximum – Rs. 10,000 If Capital Not Disclosed -Rs. 10,000 | 1250 | 2500 | 10000 | 10000 |
| 5 | Chhattisgarh | Capital is upto 50K Then Rs. 1,000 Capital more than 50K Then 2% Maximum = Rs. 5000 | 1000 | 2000 | 5000 | 5000 |
| 6 | Delhi | 1% of Capital Min -Rs. 200 Max -Rs. 5000 | 500 | 1000 | 5000 | 5000 |
| 7 | Goa | Capital is less than 50K Then Rs. 500 Every addition cap of 50K – Add Rs. 500 Maximum – Rs. 5000 | 500 | 1000 | 5000 | 5000 |
| 8 | Gujarat | Rs. 1 for every 100 capital or part thereof Max- Rs. 10,000 | 500 | 1000 | 5000 | 10000 |
| 9 | Haryana | 1000 | 1000 | 1000 | 1000 | 1000 |
| 10 | Himachal Pradesh | 100 | 100 | 100 | 100 | 100 |
| 11 | Jammu & Kashmir Jammu | Capital upto 50K – Rs. 1000 Capital Exceeding 50K – 2% | 1000 | 2000 | 10000 | 20000 |
| 12 | Jharkhand | If capital disclosed then 2.5% Maximum – Rs. 10,000 If Capital Not Disclosed -Rs. 10,000 | 1250 | 2500 | 10000 | 10000 |
| 13 | Karnataka | Rs. 2000 | 2000 | 2000 | 2000 | 2000 |
| 14 | Kerala | Flat Rs. 5000 at all Capital Levels | 5000 | 5000 | 5000 | 5000 |
| 15 | Madhya Pradesh | Minimum Rs. 2000 Maximum Rs. 10,000 Standard Rate @ 2% of Capital | 2000 | 2000 | 10000 | 10000 |
| 16 | Maharashtra | Capital upto 50000 – Rs. 500 Exceeding 50,000 – 1% (Max 15,000) | 500 | 1000 | 5000 | 10000 |
| 17 | Manipur | 100 | 100 | 100 | 100 | 100 |
| 18 | Meghalaya | 100 | 100 | 100 | 100 | 100 |
| 19 | Mizoram | 100 | 100 | 100 | 100 | 100 |
| 20 | Nagaland | 100 | 100 | 100 | 100 | 100 |
| 21 | Orissa | Capital is upto Rs. 500 – Rs. 50 Other Cases – Rs.2000 | 50 | 2000 | 2000 | 2000 |
| 22 | Punjab | Capital is upto Rs. 500 – Rs. 4 Other Cases – Rs.1000 | 1000 | 1000 | 1000 | 1000 |
| 23 | Rajasthan | For Every Rs. 50000 – Rs. 2000/- Maximum Rs. 10,000 | 2000 | 4000 | 10000 | 10000 |
| 24 | Sikkim | 100 | 100 | 100 | 100 | |
| 25 | Tamil Nadu | Capital upto Rs. 500 – Rs. 50/- In any other case – Rs. 3000/- | 3000 | 3000 | 3000 | 3000 |
| 26 | Telangana | Rs. 100/- for capital upto Rs. 5000/- Rs. 300/- In all other cases | 300 | 300 | 300 | 300 |
| 27 | Tripura | 100 | 100 | 100 | 100 | 100 |
| 28 | Uttar Pradesh | 750 | 750 | 750 | 750 | 750 |
| 29 | Uttarakhand | 750 | 750 | 750 | 750 | 750 |
| 30 | West Bengal | 150 | 150 | 150 | 150 | 150 |
Conclusion
Need Help: Well, as you might have noted that the stamp duty on the LLP agreement is not uniform and changes from state to state. Though mostly it is based on the Capital of LLP, however, few states impose a flat rate of stamp duty, such as Karnataka. You may consult us on the applicability of the stamp duty by sending an email at help@setindiabiz.com or chat with our support executives.
Conclusion
The LLP Agreement being a vital document, loses the legal validity if it is not executed on stamp paper of appropriate value or the stamp duty is inadequate. In the case of LLP filing of the LLP agreement in Form-3 is mandatory, and you should not miss it. We conclude this article and believe that the detailed discussion on the LLP agreement should be useful to you and request your feedback in the comment box.
