- New Secrutisation law –full text
- The President recently enacted a securitization (and some other things) Ordinance – see Vinod Kothari's quick notes.For text of original Securitization Bill, click here
- For RBI guidelines on investment in RMBS paper, click here
Order dated 30th April, 1997
No. RD 184 MUNOMU 97(P). In exercise of the powers by clause (a) of Sub-Section (1) of Section 9 of the Karnataka Stamp Act, 1957 (Kanataka Act 34 of 1957), the Government of Karnataka, being of the opinion that it is necessary in the public interest so to do, hereby reduces with effect from 1st April, 1997, the duty with which the instrument of securitisation of loans or of Assignment of debt with underlying Securities is chargeable under Clause 91) of Article 20 of the Schedule to "Fifty Paise" for every Rs. 500/- or part thereof the loan securitised or debt assigned with underlying securities."
Order dated 11th May, 1994
No. STP. 1094/CR-369/(C)-M-1 – In the exercise of the powers conferred by Clause (a) of Section 9 of the Bombay Stamp Act, 1958 (Bom.LX of 1958), the Government of Maharashtra hereby reduces with effect from 1st April, 1994 the duty with which an instrument of securitisation of Loans or Assignment of Debt with underlying securities is chargeable under Clause (a) of Article 25 of Schedule 1 to the said Act, to "Fifty Paise" for every rupees 500 pr part thereof of the loan securitised or debt assigned with underlying securities and in case of instrument of Assignment of Receivables in respect of use of credit cards to "Two Rupees and Fifty Paise for every rupees 500 or part thereof.
ORDER DATED 25TH FEBRUARY, 1998
No. GHM – 98-221H.STP/1096/2527/H.1. In exercise of the powers conferred by Clause (a) of Section 9 of the Bombay Stamp Act, 1958 (Bom.LX of 1958), the Government of Gujarat hereby reduces the duty with which an instrument of securitisation of Loans or the Assignment of Debt with underlying securities is chargeable under Article 20(a) of Schedule 1 to the said Act, to ten paise for every rupees 100 or part thereof of the loan securitised or debt assigned with underlying securities.
"Notification Dated 17/2/1997
In exercise of the powers conferred by clause (a) of sub-section (1) of section 9 of the Indian Stamp Act, 1899 (Central Act II of 1899), the Governor of Tamil Nadu hereby reduces the duty chargeable under the said Act to 0.1% in respect of any instrument of securitisation of housing loans executed by housing fnance institutions in favour of refinancing or intermediary investments institutions evidencing assignment of debt, whether with or without the security of mortgage of immovable property, pledge or hypothecation, including any instrument issued by the assignee or his agent which purports to evidence and/or transfer any interest in the debt and/or underlying security therefor and/or any transfer or transfers thereof."
It will be pertinent to reproduce the order of the Government of Tamilnadu explaining the rationale behind the notification dated 17/2/1997
"G.O.Ms. No. 58 dated 17/2/1997
ORDER : The Government have examined the suggestion of Government of India for reduction or remission of stamp duty on instruments of securitisation of housing loans by Housing Finance Institutions like Housing Development Finance Corporation etc. with a view to implement the objective of the National Housing Policy to increase the liquidity of the housing finance system by establishing a viable secondary market. As per the present provisions of the Indian Stamp Act, 1899, an instrument of securitisation of housing loans executed by Housing Finance institutions in favour of refinancing or intermediary investment institution is chargeable to duty as a deed of conveyance at 13% of the loan value in the State of Tamil Nadu.
2. The the Government considers that the levy of 13% stamp duty on such instruments of securitisation will render the whole process unviable. It is felt that unless the stamp duty on such instruments is at a token level, instruments of securitisation cannot be traded in secondary capital market, particularly for housing, would not be possible. It is observed that the Government of Maharashtra had issued a notification specifying that the stamp duty payable on instruments of securitisation transactions would be 0.1%..
3. Taking into consideration of the above, the Government have decided to reduce the stamp duty payable under the Indian Stamp Act, 1899 in respect of securitisation of housing loans by Housing Finance Institutions to 0.1% of the securitisation value.
Government of West Bengal
No. 1975 – F T Calcutta the 7th July, 1999
In exercise of the powers conferred by clause 3 (a) of sub-section (1) read with clause (b) of sub-section (2), of section 9 of the Indian Stamp Act, 1899 ( 2 of 1899), the Governor is pleased hereby to direct that the stamp duty chargeable on any instrument evidencing assignment of debt (whether unsecured or secured by movable or immovable property) for the purpose of securitisation of such debt shall be reduced to one-tenth of one percentum of the amount involved.
By order of the Governor
T K Basu
Deputy Secretary to the Govt of West Bengal