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Karnataka, which implemented the e-stamping system in Bangalore on Friday to prevent fraudulent practices in stamp paper-based transactions and registrations, plans to extend it across the state in a phased manner.
The system, launched in association with Stock Holding Corporation of India Ltd (SHCIL), has been designed to prevent paper and process-related fraudulent practices in registration.
It offers a secure and reliable stamp duty collection mechanism; and stores information in secured electronic form and builds up a central data repository to facilitate easy verification. It generates online Management Information System (MIS) reports for the government and public.
In future, Authorised Stamping Centre (ASC) will collect payment for stamp duty and issue stamp certificates. A paper application form needs to be filled in with details of both parties, the type of stamp duty to be paid, payment details - cash or Demand Draft in favour of SHCIL - e-Stamping Karnataka.
The ASC official will collect payment and feed details of the transaction into the system, which will generate a stamp duty paid certificate. The entire exercise of stamp duty payment and generation of stamp duty certificate takes no more than three minutes.
The e-stamping facility will initially be available at sub-registrar offices (SROs) at Gandhinagar, Jayanagar, Shivajinagar, SHCIL offices at J C Road, Koramangala, Jayanagar, Malleswaram and Lawyer's Association at the Civil Court Complex, Gandhinagar. The state government and SHCIL plan to roll-out the facility across Karnataka after completing a pilot spread over three months.
The state government will pay a certain commission to SHCIL for the services. For every transaction of Rs 100, SHCIL will receive 65 paise as commission. The state is expected to rake in Rs 3,812 crore as revenue from stamp duty during 2007-08 and expects to raise Rs 4,175 crore during 2008-09.
At present, seven banks, including the State Bank of Mysore, are issuing stamp papers. These banks will continue to issue the stamp papers, but not under the e-stamping
The SHCIL has been authorised by the Centre to act as the central record keeping agency for the e-stamping project. SHCIL MD R C Razdan said the e-stamping system has multi-level security. The stamp certificate generated by the system comes with a unique identification number (UIN) which is not repeated. The authenticity of the stamp certificate can be verified with the help of UIN on the e-stamping website 'www.shcilestamp.com'.
"The system generates a tamper-proof certificate through encryption of important identification content of the stamp certificate. An optical watermarking eliminates the possibility of duplication of the stamp certificate," he added.
Stamp duty is payable before execution of the document or on the day of execution of document or on the next working day. Instruments on which stamp duty is paid include all transfer documents including agreements to sell, conveyance deed, gift deed, mortgage deed, exchange deed, deed of partition, power of attorney, leave and licence agreement, agreement of tenancy, lease deeds, power of attorney to sell for consideration among others.
When a nominee transfers the flat subsequently in the name of the legal heir, such transfer also requires stamp duty.
SHCIL, which has been appointed by the Centre as a Central Record Keeping Agency (CRA), has implemented the e-stamping facility in five cities in Gujarat - Ahmedabad, Gandhinagar, Surat, Rajkot, and Baroda - last year. "We are currently in advanced talks with Maharashtra, Delhi, Bihar and Tamil Nadu for establishing its e-stamping facility," Razdan added.
SHCIL is jointly promoted by Industrial Development Bank of India (IDBI), Life Insurance Corporation of India (LIC), Unit Trust of India (UTI), General Insurance Corporation of India (GIC) and National Insurance. SHCIL, in the last two decades, has evolved from being a custodian with operations at Mumbai, Delhi, Kolkata and Chennai, into a provider of financial services like depository, derivatives, and retailing of third party financial services to institutional clients and retail investors.