SG Mart Ltd Fights ₹1.89 Crore Stamp Duty Demand

SG Mart Ltd is contesting a significant demand of ₹1.89 crore for stamp duty and penalties issued by the Office of the Collector of Stamps in Delhi. The company has initiated legal proceedings by filing a writ petition in the Delhi High Court.

What Happened

On May 26, 2026, SG Mart Ltd received an order from the Delhi Collector of Stamps regarding stamp duty for shares issued in dematerialized form. The order claims ₹1.89 crore is due, consisting of ₹0.88 crore in stamp duty and ₹1.01 crore as a penalty for the fiscal years 2023-26. This demand is based on a 2025 circular from the Delhi Revenue Department concerning the interpretation of stamp duty for such share issuances.

Why It Matters

This demand represents a substantial potential financial obligation for SG Mart Ltd. The company maintains that it has fulfilled its stamp duty obligations through the depository system. However, the revenue department's demand and penalty introduce financial uncertainty, which will only be resolved by the outcome of the legal challenge.

Background

The core of the dispute lies in how stamp duty is applied to shares issued in dematerialized form, an area that has attracted regulatory attention. SG Mart Ltd asserts its compliance with Section 9A(1) of the Indian Stamp Act, 1899, and confirms the use of the designated depository mechanism for payments.

What Changes Now

SG Mart Ltd has formally challenged the Collector's order by filing a writ petition with the Delhi High Court. The company's financial standing will only be impacted if the court rules unfavorably. Until a decision is made, the liability remains contingent.

Potential Risks

The main risk for SG Mart Ltd and its investors is an unfavorable decision from the Delhi High Court, which would necessitate payment of the full ₹1.89 crore demand. Investors are advised to follow the progress of these court proceedings.

Key Figures

• Total Demand: ₹1.8939 crore
• Stamp Duty Amount: ₹0.8839 crore
• Penalty Amount: ₹1.01 crore
• Applicable Period: FY 2023-26

Next Steps

Investors should closely track any updates regarding the writ petition filed by SG Mart Ltd in the Delhi High Court, as developments in this case will clarify the status of this contingent liability.