Stamp Duties Levied by Union and Retained by States
Official heading: “Duties levied by the Union but collected and appropriated by the States”
- Source edition
- The Constitution of India (as on 1 May 2026)
- Source locator
- Part XII, Article 268, printed pages 156–157
- Last human source-link check
- Not yet checked
- Last human legal review
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1. In One Sentence
Provides that specified stamp duties are levied by the Government of India but collected and appropriated directly by the States within which they are leviable.
2. What It Means in Everyday Language
Article 268 is part of the constitutional scheme for sharing revenue between the Union and the States.
It covers stamp duties mentioned in the Union List (such as stamp duties on bills of exchange, cheques, promissory notes, bills of lading, and transfer of shares).
These duties are legislated and levied by the Government of India, but are collected directly by the State in which they are levied and do not form part of the Consolidated Fund of India.
The proceeds are retained and appropriated entirely by the collecting State for its own development.
Following the 101st Amendment (GST) in 2016, excise duties on medicinal and toilet preparations were removed from Article 268 and subsumed under GST.
3. Practical Illustrative Example
A financial institution executes commercial bills of exchange or promissory notes in Karnataka subject to stamp duty under the Indian Stamp Act.
4. Important Limits, Qualifications & Exceptions
Article 268 provides a uniform national tax base with decentralized revenue retention.
- Central levy: Parliament sets uniform national rates under List I Entry 91.
- State collection and retention: Collected and appropriated entirely by the State within which it arises.
- Excluded from Consolidated Fund of India: Does not enter central revenue pools for sharing.
5. Operative Constitutional Text
6. Sources & Historical Assembly Deliberations
Assembly quotations are withheld until wording, dates, and attribution have been checked against the primary record.
- •Government of India (Legislative Department, Ministry of Law and Justice) • Part XII, Article 268, printed pages 156–157 • Human source-link check pending
Primary PDF accessed and transcribed with AI assistance on 14 October 2026. Formatting and amendment annotation markers are omitted; operative wording is retained. This is not human legal review. Later amendments and commencement notifications have not been comprehensively checked.