No stamp duty on property transfer in blood relations

SC Vaudeva

I have two queries regarding the revenue tax. First, in your recent column you had stated that there is no tax on transfer of property in blood relations in Punjab. However, an official told us that we will have to pay tax at 4 per cent in addition to 1 per cent on transfer. Please clarify giving the notification number, if any. Finally, what is the procedure to get the mutation done on behalf of family settlement written among four brothers for different properties partitioned with mutual consent and written accordingly with witnesses (not registered family settlement)? — SK Bhatia

The relevant Notification of the Punjab Government in respect of transfer of immovable property to blood relations dated May 7, 2014 is SO 28/CA..2/1899/S.9/2014. A clarification in this respect also appeared in the columns of The Tribune on May 21, 2014, wherein it has been clarified that no stamp duty would be payable, but infrastructure cess and registration fee would be payable at 4 per cent in urban areas and 1 per cent in rural areas. The mutation in respect of family settlement will have to be done with the sub-registrar of the district as he is the custodian of the revenue records of the relevant district.

The Bank of India, Kashmir Avenue, Amritsar, where I had the fixed deposits (FDs), deducted the following amounts in 2012-13 and 2013-14. My one FD for RS 78,696.95 had maturity value of RS 90,404.48 but was renewed for RS 89,414.29, deducting RS 990 on October 15, 2012. Another FD for RS 24,064 matured on July, 30, 2012 with maturity value of RS 27,761 but only RS 27,127.16 was credited into my account, depriving me of RS 634. My third FD of RS 47,941.07 with maturity value of RS 55,512.22, matured on August 25, 2012 but was renewed for RS 54,362.93, deducting RS 1,150. Thus, I was deprived of RS 2,774 in 2012-13.  These deductions were made by the bank despite the submission of 15-H form by me.  However, TDS deducted has been shown NIL in form No. 16-A. In 2013-14, several similar deductions were made on my matured FDs. This time again the form 16-A showed TDS deducted as NIL. The bank was evasive on the issue when I approached it for clarification.  Even the ITO, TDS II, Amritsar, is not inclined to pursue the case. Kindly guide me. — Baldev Raj Preenja

The issue raised by you in the query cannot be resolved by the Tax Department because the tax deduction certificate issued by the bank reflects the amount of tax deducted at source as Nil.  The matter should therefore be taken up with the bank authorities.  It is, therefore, suggested that you may send your grievance in this respect to the grievance cell of the Bank of India and a copy thereof should be sent to the Securities Exchange Board of India.  The relevant addresses or e-mail IDs can be obtained from the website of the Bank of India.

I intend to start an advertising agency business and have come to know that as per Section 65 (105) (zzzm) of the Finance Act, 1994, the service tax is not payable on sale of space or time for advertisement in print media, being newspapers, excluding business directories, yellow pages and trade catalogues, which are primarily meant for commercial purposes. However, in Chandigarh, advertising agencies are charging the service tax. 

Are they right in charging the tax? — VS Sethi

The constitutional validity of levy of service tax on services rendered by advertising agencies has been upheld by the Madras High Court in the case of Advertising Club  vs CBEC (2002) 12 Taxman 287.  The high court has distinguished the exemption provided in sub-clause (zzzm) of Section 65 (105) of the Finance Act, 1994 in respect of sale of space for advertising in print media with the services rendered by the advertising agency.  The court has, thus, upheld levy of service tax on advertising agencies. Therefore, in my opinion, 

the service tax is being correctly charged by the advertising agencies in Chandigarh.