4 min readNew DelhiJun 2, 2026 06:19 AM IST
To curb undervaluation of properties and ensure that government receives the correct amount of stamp duty, the revenue department has directed all sub-registrars and joint sub-registrars to closely scrutinise property registrations and take action to recover deficient amount if the declared property value is lower than the circle rates, particularly in cases involving basements in residential areas, officials said on Monday.
The circle rate is the minimum price fixed by the state government below which a property cannot be sold, while a stamp duty is levied to register documents, like an agreement or transaction paper between two or more parties, with the registrar.
The circular, issued by the Divisional Commissioner’s office, lays down the procedure to be followed under Section 47-A of the Indian Stamp Act, 1899, in cases where properties appear to be undervalued.
Officials also said that the circular has been issued following a recent High Court order.
According to the circular, under the Delhi Stamp (Prevention of Under-valuation of Instruments) Rules, 2007, owners must clearly specify both the plinth area (covered area) and built-up area (total physical footprint) of the property and the stamp duty will be calculated on the basis of these values, including the construction cost.
“In the case of partial sale of property, the valuation shall be proportional to the actual plinth area sold, and the stamp duty shall be determined accordingly,” read the circular issued by the department.
However, it is often observed that stamp duty is incorrectly computed on the maximum permissible plinth area instead of the actual built-up area, leading to undervaluation, it said.
Story continues below this ad
“In particular, issues have been observed in relation to the registration of basements of residential properties, where the consideration mentioned in the instrument is found to be lower than the valuation as per the applicable circle rates,” read the circular.
In the wake of concerns over people undervaluing properties to save on stamp duty, the department directed sub-registrars to inform concerned parties in writing when they register a property that they are paying less than the required amount if the declared property value is lower than the official circle rate.
The department also said that concerned individuals shall be given an opportunity to revise and amend the document to reflect the correct valuation as per the circle rates and to pay the deficient stamp duty, if any.
“If the parties fail to amend the instrument and do not pay the requisite stamp duty as per the circle rate valuation, the sub-registrar and joint sub-registrar shall register the instrument with an endorsement regarding the deficiency and forward the registered document to the collector of stamps for for determination of the correct market value and proper stamp duty…,”read the circular.
Story continues below this ad
The Collector of Stamps has been directed to dispose of such cases within three months of receiving the documents, said officials. “Upon receipt of the document, the Collector of Stamps shall proceed in accordance with law…to assess the correct market value and recover any deficiency in stamp duty…The proceedings under Section 47-A of the Indian Stamp Act, 1899, as applicable to the State of Delhi, shall ordinarily be disposed of within a period of three months from the date of receipt of the documents by the Collector of Stamps,” the circular read.
