Trilegal secured Delhi High Court relief in dematerialised shares stamp duty dispute
The leading law firm in India, Trilegal successfully secured an unconditional order from the Delhi High Court in favour of Digital Edge DC (India) restraining the Collector of Stamps, NCT of Delhi from passing final orders pursuant to notices issued seeking payment of purported deficit stamp duty and penalty on the issuance of dematerialised shares.
Background of the Dispute
Amendments introduced through the Finance Act, 2019 to the Stamp Act established a unified framework prescribing a 0.005% stamp duty rate on the issuance of dematerialised securities, which had been followed uniformly across India for over five years.
In 2025, the Government of NCT of Delhi issued a circular inter alia asserting a higher 0.1% rate of stamp duty for Delhi-registered companies, following which several companies, including Digital Edge, received notices seeking payment of alleged deficit stamp duty and penalty.
Constitutional & Regulatory Issue
At the heart of the controversy is an apparent constitutional conflict between a centralised stamp duty regime introduced by Parliament under the Finance Act, 2019, and the position adopted by the Delhi Government through executive circulars after five years in 2025.
The litigation is expected to result in authoritative adjudication on the issue of legislative competence and resolve the uncertainty surrounding the applicable rate of stamp duty on both past and future issuances of dematerialised securities by companies.
Team
The Trilegal Dispute Resolution team acting on the matter was led by Ashish Bhan (Partner) and comprised Aayush Mitruka (Counsel), Bhavya Shukla (Senior Associate), and Lohitaksh Shively (Associate).
Conclusion
This matter is expected to have significant implications for companies issuing dematerialised securities, particularly in clarifying the scope of legislative competence and ensuring certainty in the application of stamp duty laws across jurisdictions.
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