The Legal Status of Stamp Paper

Question: A person asked, what is the status of stamp paper, and what is stamp duty?

Solution: The state imposes stamp paper and stamp duty so that whenever you carry out any financial transaction, you give something to the government through stamp paper. Now the state has set up a chart within the country. If you're buying a piece of land, you'll enter into a sale agreement, for that an agreement of sale, a sale contract requires stamp duty, that you pay this much stamp duty. If you want to appoint a general power of attorney, you pay this much stamp duty. If you want to execute a sale deed, you pay this much stamp duty. Your right is only created once you pay that stamp duty. If the state, the law, says that a hundred-rupee stamp paper is required for your transaction, and, to give you an example, you don't pay that hundred rupees in duty, the state says, if you don't take care of us, why should we take care of you? The law says the relationship should be reciprocal. The state said, we will give you courts, the state said, we will give you an excise and taxation department, the state said, we will give you hospitals, the state said, we will give you schools, the state said, we will give you roads. Now you can only hold the state accountable if we aren't getting roads, or aren't getting good roads, if we aren't getting schools, or aren't getting good ones, if we aren't getting hospitals, or aren't getting good ones, if we aren't getting courts, or aren't getting good ones. This ultimately comes back to us, we are the foundation of this. Suppose you hire an employee, you hire that employee at ten thousand rupees a month, and every month you give him seven thousand, eight thousand, five thousand, six thousand, tell me, can you then hold that employee accountable, saying you didn't do this task, you didn't do that task, this was your duty and you didn't do it? You can't, because you didn't give him what you agreed with him. Now the standard isn't in your hands anymore, it's in his hands. If you hired a cleaner at ten thousand rupees a month, and sometimes you give him five thousand, sometimes seven thousand, skimming two, three thousand off every month, not paying him fully, then can you hold him accountable, saying there's no cloth on this table, there's dust, there's rubbish piled in that corner, why aren't you holding him accountable? Why not? You can't hold him accountable ethically, because he'll stand in front of you and say, you skim money from my salary every month, you don't deduct it properly, you skim it, that's why I don't do the work properly. This same formula, this same situation applies with the state.

What is the status of stamp paper? Well, according to law, if the duty on the stamp paper is paid in full, it has full legal status. Now if you write up a twenty-marla house, a fifteen-marla house, a ten-marla house on a hundred-rupee stamp paper and say I am the owner, how will the state protect you? If you don't get a hundred-rupee stamp paper and instead just write it up on a plain piece of paper, why would the state stand up for you? Why would the state's courts, which the state created, protect you? The law that the state made, will it protect you? No, it won't. Stamp paper has full importance, there's no two ways about it. Stamp paper has complete legal status, but only if the stamp duty on it is paid in full. If the stamp duty is not paid in full and you challenge it in court, you have no case, ultimately you have no case at all. Think of it this way: here is a pencil, you don't need to prove it's a pencil, it's simply a pencil. Now if I take a coin out from inside it and tell you this is a pencil, you'll accept it's a pencil. If you say, no, this is a coin, then to prove that this coin is a pencil, how much struggle will you have to go through, how many arguments will you have to make to get this accepted as a pencil, a complete pencil, that has a coin inside it, you'll have to write it all out. It gets written, ultimately, even a coin can be made to be 'written' as a pencil, it can be written, but with great difficulty, it does get written, the court will say, fine, we'll give you a chance, go make it a full pencil, then people scramble to find an empty shell to put the coin in, and then say, we've done it, now it's a pencil, go, I've concluded this is a pencil. My point is this: initially, when you have the resources, when you have the means, if you save a few rupees, a few thousand rupees, or a few lakh rupees by paying less stamp duty, that document's legal standing becomes weaker, and against an opposing document where full stamp duty was paid, that one will prevail. That's why stamp paper carries a great deal of importance, provided it is in accordance with the law.