Firoz.T.Totanawala The Bangalore Metro Reporter THE BAAP OF TELGI SCAM (THE STAMP PAPER SCAM IS BACK AGAIN) NO RECONCILIATION

BY FIROZ.T.TOTANAWALA

  

THE BANGALORE METRO REPORTER

 

THE BAAP OF TELGI SCAM

(THE STAMP PAPER SCAM IS BACK AGAIN)

THE 2nd BLUNDER-

NO RECONCILIATION

When, the Government had planned to stop the sale of Stamp Papers in wake of Telgi Scam, the SBM was invited to submit a proposal with regard to collection of Stamp Duty by issuing receipts on behalf of the Government. The SBM then submitted a proposal on 05/04/2003 to IGR & CS. It is but obvious that there has to be a serious discipline in maintaining the records of these transactions and also in reconciliation. However, it is saddening that there has been a terrible lapse in reconciliation of the records.

In its proposal dated 05/04/2003, the SBM had clearly offered to submit daily scrolls of the transactions to the attached Sub-Registrar and Regional Office on daily basis for reconciliation; and to IGR & CS once a month. It proposed that “ At the end of every working day, the Bank will submit a scroll either electronically or by hard copy, giving the details of transactions like the receipt numbers, name of the depositors, amount deposited etc”. The same was also insisted by the IGR & CS. However, the SBM has never sent daily scrolls to its attached Sub-Registrar and Regional Office. 

According to the Note issued by the District Registrar on 21/02/2004, it states that,” However, the requirement is that a scroll of the remittances should be sent to the Treasury and the RO at the end of each day as per the Oral Agreement. The Bank is also expected to send a consolidated scroll of all the payments made in all the branches to the IGR & CS at the end of the month. This is not happening in practice at present. Thus there is no reconciliation of the payments and the Sub Registrars certify the payment on the basis of the receipts produced by the party to the document without any verification. There would be a disastrous situation, if the receipt is faked and there is no way to verify”.

Further, it was also required to send monthly transaction details every month to IGR & CS for verification and record. However, the SBM also failed here. It sent the monthly scroll to IGR & CS for a month or two only. 

The note by the District Registrar clearly states that “The arrangement with the SBM was to give a consolidated statement along with scroll, every payments of the state to the Directorate of Treasury and to the IGR & CS also. However, this is also not happening at present except for the month of April or so (2004). As a result we are the department is in dark as to the exact duty collected in this case. 

This also means the Sub-Registrar also has no knowledge about the stamp duty collected and also there is a very high chance of manipulation of amount by the SBM staff since there is no daily reconciliation. For e.g., Rupees 1,00,000/- received as Stamp duty can be recorded as Rupees 10,000/- since there is no daily scroll submitted and reconciliation is not done everyday.

What is more worrying is that it is almost impossible to reconcile the records now since there have been serious lapses in the procedure. In the initial stage itself, while authorizing the SBM to collect Stamp Duty, the arrangement was made in such a way that each designated area will have a Sub-Registrar and that particular SR will be attached with an SBM branch in that area. Now any public, who desire registration in a particular area, should only approach the SBM branch of that particular area for payment of duty. Further, every SR was instructed to accept the receipt of Stamp Duty only from their respective attached and designated SBM branch. However, due to public pressure, the Sub-Registrar collects receipts issued by any of the SBM branch. This will never allow a reconciliation since no one can know which receipt issued by bank has gone where. The same is also stressed by the District Registrar in his Note dated 21/02/2004.

Indeed, there could be manipulation to the tune of several crores and that simply means the Government losing its revenue and the public money going to crooks.

We filed an RTI with the SBM on 20/04/2009, asking them to give us Copies of Reconciliation of accounts of every year starting from 01/04/2003 up to 31/03/2009. The Bank replied to us on 19/05/2009 saying that “This is to be done by IGR & CS”.

Then, we filed an RTI with IGR & CS on dated 27/05/2009, asking for the Copies of the Reconciliation of Accounts every year from 01/04/2003 up to 31/03/2009. Interestingly or rather shockingly, the IGR & CS wrote a letter to SBM directing them to give the reconciliation copies since these details are with them. They issued us a copy of the same letter in reply to our RTI.

The state also has no means of verifying the exact amount of stamp duty collected and also stamp papers sold for the purpose of Non-Registerable articles like agreement, power of attorney’s bonds etc. as reconciliation has not been done for the last 6 years. Again, there is no chance of any foreseeable reconciliation in days to come in the absence of submission of daily scrolls by the Banks to the Sub Registry offices.

Consequently, since there is no reconciliation with any Government department, hence, the figures claimed by the SBM, whether true or false have to be accepted by the department. Now that leaves the ball in the court of SBM and they can disclose the amount they feel the Government deserves in respect of registration charges.