Supreme Court Stamp Duty Depends on Instrument’s Legal Character, Not Its Title

The Supreme Court has held that stamp duty must be assessed based on the true legal character of an instrument rather than its title.

The case involved a “Security Bond cum Mortgage Deed” executed by a company to secure obligations to the Meerut Development Authority.

The Court ruled that, despite its title, the deed functioned as a mortgage since it mortgaged properties to the authority.

Dismissing the company’s appeal for lower stamp duty under Article 57 of the Indian Stamp Act, the Court upheld the higher duty under Article 40 applicable to mortgage deeds.

[M/S Godwin Construction Pvt. Ltd. v Commissioner, Meerut Division & Anr.]