E-stamping may fully replace franking mode in Karnataka | Bengaluru News – Times of India
Officials in the stamps and registration duty department said that revenue minister R Ashoka had studied the proposal to phase out the franking system and was consulting senior officials on finer policy points. Chief minister BS Yediyurappa has reportedly given in-principle approval.
“It is a reformist step. The decision is being taken at the higher level,” said KP Mohanraj, inspector general of registration and commissioner of stamps.
Franking or e-stamping is a mode employed by the state government to collect stamp duty levied on execution of documents of various transactions. Franking is done at sub-registrars’ offices. Estamping, launched in 2008, makes the entire process simple and secure by storing the paperwork in a protected digital form and creating a central databank for verification. Applicants are given a unique certificate number and the risk of fraud is low.
The franking system was introduced after the stamp paper scam of 2001. Abdul Karim Lal Telgi, who was convicted in the case, is estimated to have caused thousands of crores of revenue loss to multiple states, including Karnataka.
The franking system didn’t turn out to be as foolproof as authorities had hoped and fraudsters continue to run rackets. In October, Silver Jubilee Park police discovered one such case. A gang led by Hussain Modi Babu, alias Chota Telgi, allegedly used duplicate machines to frank and emboss documents. Police believe many such groups are in operation and e-stamping will help curb cases.
“Currently, e-stamping is being used only partially. Most of the documents are franked. We believe that the revenue leakage can be plugged if franking is stopped and replaced with e-stamping,” said a sub-registrar. Till December, the stamps and registration department earned revenue of Rs 6,799 crore. Officials believe the figure would have been higher without franking rackets.