Chandigarh, 28 October 2025:
Cabinet Minister Sh. Sanjeev Arora today informed that Govt. of Punjab had imposed stamp duty of 0.25% of the loan amount on all equitable mortgages (where land is given as collateral) and hypothecation of immovable property i.e. stocks given as collateral against the Bank loans in January 2025, a further 0.25% subject to a ceiling of 1 lakh, on registration of equitable mortgages was also imposed.
Addressing the media, Cabinet Minister Sh. Sanjeev Arora revealed that the Government of Punjab was earning quite a lot of revenue. However, multiple industry associations like CII, PHDCCI, APEX CHAMBER, CICU, FICO, SLBC had highlighted several challenges like double taxation as most industrial loans involved both equitable mortgage as well as some hypothecation of immovable property. As of today, a loanee is paying 0.25% duty on equitable mortgage, 0.25% duty on hypothecation, and 0.25% on registration (capped). This is almost ~0.65% effective incidence.
It was particularly a burden for over 14 lakh registered MSMEs in the state. They are the creators of the maximum number of jobs, but these charges were hampering their growth and viability.
Sharing more details, Sanjeev Arora highlighted that Government of Punjab has decided to amend the notified rates in light of this issue. In this regard, Stamp Duty on the total loan amount, covering all related instruments including Equitable Mortgage and Hypothecation, shall be levied at 0.25% of the loan amount, subject to a maximum of Rs. 5,00,000 (Rs Five lakhs only). Registration Fee on Equitable Mortgage shall be Rs. 1000/- reduced from Rs. 100000/-.
Following the Cabinet decision, he said that a bill will be presented in front of the Vidhan Sabha to amend the Indian Stamp Act accordingly. This rationalisation aligns Punjab with leading industrial states, signalling a pro-business stance and allowing the state to compete more effectively for productive investments. It will lead to massive improvement in the ease of doing business, increased credit availability and credit uptake in the state. It will also enhance potentially leading to increased investments, jobs etc.
With this step Punjab has become better than other States as far as these charges are concerned i.e Haryana, Kerala, Maharashtra, Madhya Pradesh & Gujarat.
