Constitution of India – Seventh Schedule – Entries 91 of List I, 63 of List II, and 44 of List III – Rajasthan Stamp Law (Adaptation) Act, 1952. – Legislative Competence – Stamp Duty – Insurance Policies – Applicability of the Rajasthan Stamp Law (Adaptation) Act, 1952 – The Supreme Court examined the issue of whether the state of Rajasthan possesses the authority to impose and collect stamp duty on insurance policies issued within its territory.
The Court affirmed the power of the state government to levy stamp duty under the Rajasthan Stamp Law (Adaptation) Act, 1952, rejecting contentions regarding lack of legislative competence. Analyzing the relevant constitutional provisions, the Court concluded that while the Parliament holds exclusive power to prescribe rates of stamp duty on certain instruments under Entry 91 of List I, the state legislatures have the authority to enact charging provisions under Entry 44 of List III, subject to the prescribed rates by the Parliament.
The Court clarified that the state’s power to levy stamp duty is not invalidated by its inability to prescribe rates independently. The judgment emphasized the necessity of compliance with state laws for stamp duty payment, specifying the obligation to purchase stamps issued by the state government for instruments executed within the state’s jurisdiction. Notably, the Court directed the state government not to demand stamp duty based on specific orders issued in the past. The appeals were dismissed, affirming the High Court’s judgment while setting aside certain findings and relief granted to the appellant. (Para 38)
SUPREME COURT OF INDIA
2024 STPL(Web) 310 SC
[2024 INSC 358]
Life Insurance Corporation Of India Vs. State Of Rajasthan And Ors
Civil Appeal No. 3391 OF 2011 With Civil Appeal No. 3849 OF 2011 Civil Appeal No. 3393 OF 2011 Civil Appeal No. 3394 of 2011 Civil Appeal No. 3395 OF 2011-Decided on 30-04-2024
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