MCQs on THE INDIAN STAMPS ACT, 1899 Part -1

Q.1:- Who has the authority to certify that any instrument is not chargeable with duty?

• Collector
• Bank Official
• Magistrate
• None of the above

Q.2:- On the principal instrument shall be chargeable under section 4 of the Indian Stamp Act, 1899 with the duty prescribed for the conveyance, mortgage or settlement and each of other instruments shall be chargeable with the duty of Rs.

• Rs.1
• Rs.10
• Rs.100
• Rs.1000

Q.3:- What is the penalty charge under with provision of the Indian Stamp Act?

• Any delay in duty payment will pull in 3% per month to the maximum of 300% of the deficit amount of stamp duty.
• Any delay in duty payment will pull in 4% per month to the maximum of 200% of the deficit amount of stamp duty.
• Any delay in duty payment will pull in 2% per month to the maximum of 200% of the deficit amount of stamp duty.
• Any delay in duty payment will pull in 1% per month to the maximum of 100% of the deficit amount of stamp duty.

Q.4:- An Instrument chargeable to duty, other than bill or promissory note executed out of India, may be stamped within after it has been first received in India.

• 45 days
• Three months
• One month
• Two months

Q.5:- What is the maximum amount of penalty prescribed under section 65 of the Indian stamp act 1899 for refusal to give receipt, and for devices to evade duty on receipts?

• 200 rupees
• 500 rupees
• 1000 rupees
• 100 rupees

Q.6:- In case of collector having doubt as to the amount of duty with which any instrument is chargeable, who has the authority to decide the proper amount of duty?

• State Government
• Central Government
• Chief Controlling Revenue-authority
• Magistrate

Q.7:- The Indian Stamp Act 1899, came into force on:

• 1st July 1899
• 1st November 1899
• 1st June 1899
• 1st December 1899

Q.8:- Section 25 Indian Stamp Act provides for computation of duty in the case of annuities, Where the sum is payable for an indefinite period but terminable with any life in being at the date of such instrument then on the maximum amount as payable during the period of ………………………as calculated from the date on which the first payment becomes due.

• 20 Years
• 18 Years
• 12 Years
• 3 Years

Q.9:- Which of the following circumstances Stamp Duty as per Indian Stamp Act cannot be refunded:

• Stamps required for use.
• Stamps used in excess of the value required; and
• Spoiled Stamps;
• Misused Stamps;

Q.10:- Ravi owes Suresh Rs. 1,000. Ravi sells a property to Suresh, the consideration being Rs. 500 and the release of the previous debt of Rs. 1,000. Stamp-duty is payable on........:

• Rs. 1,000
• Rs. 1,500
• Rs. 500
• None of the above

Q.11:- What is considered as by duly stamped as per Indian Stamp Act, 1899.

• adhesive stamp it has be effectively cancelled and cannot be used again
• If stamp not so used as per adequate document
• In case Stamped Less than proper amount on the instrument
• stamp paper is not purchased in the name of one of the parties who would be signing the instruments

Q.12:- Which of the following transactions is exempt from Stamp duty?

• Every instrument mentioned in the schedule executed on or after July 1,1899
• Promissory note made out of India, presented for payment in India.
• Any instrument executed by the government, where the government would be liable to pay the duty chargeable.
• Bill of exchange payable on the demand

Q.13:- Attribution of electronic records means As per provision of section 11 of the Indian Stamp Act, An electronic record shall be attributed to the originator as follows –

• by a person who had the authority to act on behalf of the originator in respect of that electronic record; or
• if it was sent by the originator himself;
• by an information system programmed by or on behalf of the originator to operate automatically.”
• Any of the above.

Q.14:- As per the provisions of sections 49, 50, 52, 53 and 54, when cannot one ask for refund of stamp duty under the following circumstances:

• Misused Stamps
• Unspoiled Stamps;
• Stamps not required for use
• Stamps used in excess of the value required

Q.15:- Section 25 Indian Stamp Act provides for computation of duty in the case of annuities, Where the sum is payable in perpetuity or for an indefinite period, them on total amount as payable during the period of ……………to be calculated from the date on which the first payment becomes dues.

• 3 Years
• 18 Years
• 20 Years
• 12 Years

Q.16:- Every instrument written upon paper stamped with an impressed stamp shall be written in such manner that the stamp may appear on the......and cannot be used for or applied to any other instrument:

• Back of the instrument
• Face of the instrument
• None of the above
• Both (a) and {b)

Q.17:- As per section 57 of the Indian stamp act 1899, When Chief Controlling Revenue-authority - refers statement of the case to high court, every such case shall be decided by not less than ______ of the High Court to which it is referred, and in case of difference the opinion of the majority shall prevail:

• 3 Judges
• 7 Judges
• 2 judges
• 5 Judges -

Q.18:- Where an instrument is chargeable with ____ in respect of any money expressed in any currency other than that of India such duty shall be calculated on the value of such money in the currency of India according to the current rate of exchange on the day of the date of the instrument:

• Ad valorem duty
• Fixed amount duty
• Duty of Rs. 1000
• None of the above

Q.19:- How is stamp duty paid in transactions where more than one instrument is required?

• Stamp duty is paid only on one of the principal instruments and on the balance documents only minimum duty is payable
• Stamp Duty is paid on ad Valorem basis
• Stamp duty is paid on all the instruments equally
• Stamp Duty is paid on any one of the instrument

Q.20:- Which of the following instruments is not liable to Stamp duty in accordance with provision of the Indian Stamp Act?

• Securities dealt in depository
• Corporatization and Demutualization schemes and related instruments
• Agreement or document for assignment of receivables
• All of the above

Q.21:- Government can also___duties in case of issue of shares or debentures by companies:

• Compound or Consolidate
• Compound and consolidate
• Compound
• Consolidate

Q.22:- Rates of Stamp Duty payable for different types of documents are as per:

• Schedule IV
• Schedule III
• Schedule II
• Schedule I

Q.23:- Where an instrument is chargeable with advalorem duty inrespect of any stocker ofany marketable or other security, the duty shall be calculated on:

• Value of such stock or security according to the purchase price.
• Value as determined by the holder of the security.
• Value of such stock or security according to the average price or the value thereof on the day of the date of the instrument
• None of the above

Q.24:- The duty of the Collector under section 31 of the Indian Stamp Act, 1899 is only to determine the stamp duty payable upon the instrument where he concludes that the instrument is not sufficiently stamped. He is not authorised to

• Impose any penalty
• Impound the instrument
• Either (a) or (b).
• Both (a) and (b)

Q.25:- Instruments executed in India, All instruments chargeable with duty and executed by any person in India shall be stamped

• Any time before or at the time of execution.
• Any Time after the execution but before six month of expiration.
• Any time after the agreement sign but before one month expiration of execution.
• Any Time after the after the execution but before three month of expiration.

Q.26:- What is the purpose of Indian Stamp Act?

• To raise revenue for the local governments
• Imparts legality to the document and this can be submitted as an authentic document in courts
• None of the above
• Both (a) and (b)

Q.27:- Who has the adjudicating authority with respect to proper stamping?

• Magistrate
• Bank Official
• Collector
• None of the above

Q.28:- Which are not a common modes of payments of stamp duty are:

• Stamping the instrument with impressed stamp (eg. franking)
• Cash, in rare cases where the collector is satisfied that sufficient stamps are not available.
• Adhesive stamps available at collectors office
• None of the above.

Q.29:- Which of the following is not exemption from stamp duty

• Transactions related to transfer of rights in a ship or vessel registered under the Merchant Shipping Act.
• Conveyance - includes a conveyance on sale and every instrument by which property, and which is not otherwise specifically provided for by Schedule I
• Transactions/documents/deeds, wherein the government would be liable to pay duty
• Instrument for carrying out transactions in a SEZ

Q.30:- Which of the following circumstances Stamp Duty exempted under Indian Stamp Act:

• Bank Notes Issued by bank.
• AOP issued the share
• Trust taken grant ;
• Cooperative society issued the Membership;

Q.31:- What is the maximum amount of penalty prescribed under section 66 of the Indian stamp act 1899 for not making out policy within one month after receiving, or taking credit for, premium or consideration for any contract of insurance or making one not duly stamped?

• Five hundred rupees
• One thousand rupees
• Two hundred rupees
• One hundred rupees

Q.32:- An instrument chargeable with duty executed out of india may be stamped within_ month(s) after it has been first received in India

• Three
• Two
• Four
• None of the above

Q.33:- Which of the following instruments is not liable to Stamp duty in accordance with provision of the Indian Stamp Act?

• Conversion of a branch of any bank into a wholly owned subsidiary of bank or transfer of shareholding of a bank to a holding company of bank
• Agreement or document for transfer or assignment of rights or interest in financial assets
• Negotiable warehouse receipts
• All of the above

Q.34:- Certain instruments can be stamped by the use of adhesive stamps. Amongst the documents listed below, is there an odd one out?

• Bill of exchange or promissory notes drawn or made out of India.
• Negotiable warehouse receipts.
• Entry as an advocate on roll in High court.
• Transfers by endorsement of shares in any incorporated company.

Q.35:- Stamp duty is to be charged with reference to the.......:

• Date of Document
• Date of signing
• Date of execution
• Any of the above

Q.36:- The first holder in India of any bill of exchange payable otherwise than on demand, or promissory note drawn or made out of India shall......... he presents the same for acceptance of payment, or endorses, transfers or otherwise negotiates the same in India affix there to proper stamp and cancel the same:,

• Within two month
• Before
• Within three month
• Within one month

Q.37:- Which of the following instrument may be stamped with adhesive stamps?

• Notaries acts
• Transfers by endorsement of shares in any incorporated company or other body corporate
• Entry as an Advocate, Vakil or Attorney on the roll of a High Court
• All of the above

Q.38:- Indian Stamp Act, 1899 provides the scope of two authorities who can refund the penalty in excess of duty payable on instrument in certain cases. Refund order can be made by:-

• Collector or Chief Controller Revenue authorities.
• Deistic Magistrate or Chief Deistic Magistrate
• Principal Officer of State or Revenue Officer Central Government
• Officers Specified by State Government or Officers specified by Central Government

Q.39:- An instrument in writing containing an unconditional order signed by the maker is called-

• Cheque
• Promissory note.
• Bill of exchange
• I.O.U

Q.40:- Arvind owes Bablu Rs.1000. Arvind sells a property to Bablu, the consideration being Rs.500 and release of the previous debt of Rs.1000. Stamp duty will be payable on Rs……….

• Rs.2500/-
• Rs 1800/-
• Rs.2000/-
• Rs.1500/-

Q.41:- Who has the power to make the rules relating to sale of stamps?

• State Government
• Collector
• Central Government
• Chief Controlling Revenue-authority

Q.42:- Which are following are not instrument as per defined under Section 2 (14) Indian Stamp Act, 1899.

• An entry in register containing the term of hiring of machinery
• Photocopy of an agreement
• Bond
• A document by which any such right or liability is only recorded even though the document itself does not create such a right or liability.

Q.43:- Any person who, with intent to defraud the Government of duty, draws, makes or issues any bill of exchange or promissory note bearing a date subsequent to that on which such bill or noteis actually drawn or made, what is the maximum amount of penalty prescribed under section 68 of the Indian stamp act 1899?

• One thousand rupees
• Five hundred rupees
• One hundred rupees
• Two hundred rupees

Q.44:- Which are the instruments cannot be stamped with adhesive stamps as per the Indian Stamp Act, 1899?

• Entry as an advocate, vakil or attorney on the roll of a High Court;
• Transfers by non-endorsement of shares in any incorporated company or other body corporate.
• Instruments chargeable with a duty not exceeding ten naye paise except parts of bills of exchange payable otherwise than on demand and drawn in sets;
• Bills of exchange and promissory notes drawn or made out of India;

Q.45:- E-Stamp is basically an electronically generated stamp which can be used as a non-judicial stamp and can be used to pay stamp duty to the government. Which of following are not Benefits of E-stamp

• They are very easily accessible.
• E-stamps are user-friendly.
• E-stamps are time-consuming.
• They are cost saving.

Q.46:- Which of the following is not included in the definition of “Bill of exchange payable on demand?

• Any instrument attested by a witness and payable to order or bearer, whereby a person /obliges himself to pay money to another
• A letter of credit, an instrument by which one person authorities another to give credit, to the person in whose favour it is drawn
• An order for the payment of any sum of money by a bill of exchange or promissory note
• An order of the payment of any sum of money weekly, monthly, or at any other states period person is whose favour it is drawn

Q.47:- In which cases stamp duty as per Indian Stamp Act, 1899 shall be chargeable in respect of following.

• Any instrument executed by or on behalf of or in favour of the Government,
• An instrument executed by or on the behalf for the Purpose of special Economic Zone.
• Any instrument executed by or on behalf of or in favour of the Trust,
• Wills are not subject to duty because there is no mention of them in the schedule.

Q.48:- All instruments chargeable with duty and executed by any person in India shall be stamped........:

• At the time of execution
• Before or at the time of execution
• Before execution
• None of the above

Q.49:- What is the maximum amount of penalty prescribed under section 62 of the Indian stamp act 1899 for executing instrument not duly stamped?

• 500 rupees
• 1000 rupees
• 200 rupees
• 100 rupees

Q.50:- Any person appointed to sell stamps who disobeys any rule made under section 74, any person not so appointed who sells or offers for sale any stamp (other than a [ten nayepaise for five nayepaise] adhesive stamp) shall be punishable with imprisonment for a term which may extend to........., or with fine which may extend to......, or with both: , or with fine which may extend to , or with both:

• Two months. Two hundred rupees
• Six months. Five hundred rupees
• One months, One hundred rupees
• Three months. Five hundred rupees