Before we answer your question, let me explain about Franking. Franking is the process of paying stamp duty in sub-registrar office, whereas sub-registrar office uses a machine to print the stamp duty amount. This franking process existed before the electronic mode of payment. The franking stamp duty looks like the below image
Nowadays, the franking process of payment is not exist. We pay stamp duty only in the electronic mode in sub-registrar office and we call this process Adjudication. Hence let’s ignore the franking process
Both e-stamp paper and adjudication are equally accepted to execute a sale agreement. But I prefer adjudication over e-stamp paper for the following reasons
- In adjudication, we can offset the stamp duty cost at the time of sale deed registration, which is 0.5% of consideration
- The cost of error is more in e-stamp paper than adjudication. A small error in stamp paper costs you the whole stamp duty value but in adjudication cost of error is minor.
- We can hand correct the error in adjudication, but we cannot hand correct stamp paper once printed
Below is the procedure to execute ADJUDICATION:
Step 1: Print the sale agreement on A4 size document or bond paper
Step 2: Seller and buyer sign the sale agreement at all pages. Two witnesses sign at last pages of agreement
Step 3: In Karnataka, the adjudication cost is 0.5% of the sale value or guidance value, whichever is higher
For example: The sale value is Rs. 50 Lakh. adjudication cost is 50,00,000*0.5% = Rs.25,000/-
Pay the adjudication cost on Khajane-2 website and print the transaction receipt
Step 4: Carry the sale agreement, transaction receipt and walk into the respective sub-register office.
- Staff verifies the transaction receipt and Sale Agreement
- Staff Prints the adjudication receipt at the backside of your sale agreement, signs the adjudication receipt and hands back the sale agreement to you
This completed the adjudication way of paying stamp duty. An adjudication receipt looks like the below image
Below is the procedure to execute E-STAMP PAPER:
Step 1: Calculate the stamp value.
In Karnataka, the stamp value is 0.5% of the sale value or guidance value, whichever is higher
For example: Sale value is Rs. 50 Lakh. stamp value 50,00,000*0.1% = Rs.25,000/-
Step 2: Buy non-judicial E-stamp paper at the nearest co-operative bank, register office, court, or any approved stamp vendor.
When you buy the e-stamp paper, you need to give the following details
- 1st party name (Seller)
- 2nd party name (Buyer)
- Stamp value (0.5% of sale value)
- Stamp paper purchaser’s name and contact number
You must provide correct input while you purchase e-stamp paper. A complete stamp paper would be wasted even if there is a small spelling mistake in the input. The stamp vendor may not take responsibility for your mistake and refund is a cumbersome process.
Step 3: Get your sale agreement drafted in Word format.
Step 4: Print the draft on e-stamp paper. Use document or bond paper for consecutive pages of print.
Step 5: Seller and buyer should sign on all pages of the agreement. Two witnesses sign at the witness section on last page
An E-Stamp looks like the below image.
This completes the process of paying stamp duty through e-stamp paper
A few important points for your consideration.
- In adjudication, 1st you need to execute sale agreement, sign, and last pay stamp duty
- In e-stamp, 1st you need to pay stamp duty and last execute sale agreement & sign
- The cost of error is nominal in adjudication. Whereas the cost of error is high in e-stamping. Even a single letter of error cost your complete stamp duty.
- You have to go to the respective sub-register office to get your sale agreement adjudication. Whereas you can buy e-stamp paper from any of the authorized vendors near you.
- Both adjudication and e-stamp cost are offset at the time of sale deed registration.
- For a home loan application, either adjudication or e-stamp is accepted
We assist Sale Agreement execution, please write to us pgnproperties@gmail.com or Whatsapp to +91-97424-79020
Thank you for reading…