The Bangalore Metro Reporter
THE SBM STAMP PAPER SCAM-4
THE 4th BLUNDER- NO RECONCILIATION
In our last issues, we revealed that the State Bank of Mysore had no written agreement with the Government to print and sell Stamp Papers of various denominations on its own. Further, while it did print it, the stamp papers of SBM had its own different designs with lapses in the security features as prescribed by the government. All this undertakings were based merely on a proposal letter.
In this issue, we explain you how the SBM defaulted on reconciliation duty as proposed by itself.
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. The SBM then submitted a proposal on 05/04/2003 to IGR & CS with regard to collection of Stamp Duty by issuing receipts on behalf of the Government. 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, SBM 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 every day.
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 desired 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 collected receipts issued by any of the SBM branch. This would 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 lost its valuable revenue and the public money went to crooks.
In reply to an RTI dated 20/04/2009, asking the SBM to give the Copies of Reconciliation of accounts of every year starting from 01/04/2003 up to 31/03/2009, the Bank replied on 19/05/2009 saying that “This is to be done by IGR & CS”.
Further, when the RTI was filed 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, 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 so many 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.
No Authority, No Supervision
If the State Government had instructed the SBM to collect the Stamp duty on its behalf, then it had to be more transparent. There should obviously be authorities responsible and liable with regard to issues relating to the Stamp duty collection. However, unfortunately, there was no authority genuinely responsible, accountable and liable for the same.
The most astonishing fact is that as per IGR & CS Letter obtained through RTI, the SBM itself was in charge of printing, selling and accounting of Stamp Papers. No Government representative or any one from the Department of Stamps and Registration was allotted the authority to oversee the accounting of Stamp Papers. All the details as furnished by the SBM, was blindly accepted as true and binding by the Government. Further, another shocking fact is that as per Government Order, if anything goes wrong or any kind of problem arises with respect to Stamp Paper or Stamp Duty Collections, the SBM authorities would be held responsible for the same. That simply means that the authorities of Departments of Stamps and Registration are all dummies. They were merely sitting and eating up public money officially without doing their duty of supervising, controlling, inspecting and accounting the Printing and collection of Stamp Duty by SBM.
How can an activity of such importance like the revenue collection run on passing the buck game? If the Stamp Paper racket by Telgi was a huge scam, then what does this system practiced by the Government authorities and the SBM is called? How can the operation of stamp paper machinery which is in tunes of crores of rupees be blindly handed over to SBM, to be controlled as per its whims and fancies.
In reply to an RTI with SBM dated 18th April 2009, asking whether there is any authority either from the Governments or IGR & CS department’s side to inspect and supervise the Stamp Paper activities, the SBM clearly replied as ‘NO’. In that case, the full and final authority with regard to the Stamp Papers, by default was SBM. Then, how can anyone prove genuineness of the facts and figures as disclosed by the SBM? Further, while the Government has clearly mentioned that SBM authorities will be responsible for any lapses or frauds, it sounds suspicious as to why the Government put this condition in first place and why did the SBM authorities accept this criteria?
It should be noted that there is also no supervision done by anyone from the department or from the Government’s side. An RTI was filed with the IGR & CS department on 02nd June 2009, asking them to give me details of Stamp Papers printed and sold by SBM from 01st April 2003 to 31st March 2009. In reply, the department sent me a copy of a letter which they sent to SBM asking them to provide me the details and in turn informing me to collect the said information from them. That logically means that the department does not have any information with regard to number of Stamp Papers printed and sold by SBM.
Besides, the department also does not have any information about the Stamp duty collected from Non-registerable documents by SBM through its Stamp Papers. It also does not know how much money the SBM has remitted in the Government Treasury and they are also unaware about the details of sale of Stamp Papers in various denomination. The above information was requested through an RTI dated 27th May 2009, but, the department in turn asked SBM to provide the information.
To be continued…..
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