The manufacture of fake stamps and stamp paper has been on, at least from the late 1980s. But it has grown from a small, localised business, concentrated around Mumbais stock market and real estate business, into a mega operation covering at least 12 states and their police machinery.
Those days the Bombay Stock Exchange followed an open outcry system and settled share transactions through physical delivery of shares. The hub of all market activity in the country was the third floor trading ring at the imposing Jeejeebhoy Towers. A spiral staircase and the landing leading away from the ring was a beehive of support services catering to brokers needs. Among them were vendors offering a variety of snacks and chai, shoe shine boys and typists. There were some unusual services too. Such as people who earned their living by filling out transfer forms; or the briefcasewallahs who sold revenue stamps and stamp paper, and even a master forger who eliminated hassles of matching signature by expertly forging them for a small fee.
It took me several years to learn about the forger and understand why the seemingly mind boggling hassles of signature mismatches and physical deliveries did not seem to bother brokers as much as they should have.
My stamp source claimed that many of the briefcasewallahs sold four categories of stamps and that the buyers knew exactly what they were buying. Genuine stamps were the first category, the second were fake prints on genuine security paper, the third were complete fakes and the fourth was more astonishing. These were used stamps that were apparently accepted by the share transfer departments of specific companies that colluded with the sellers.
I found nobody who would speak up or give details, although it was obvious that most people knew about the racket. A usually helpful source in a share custodial company not only refused to speak, but even advised me to drop the story. Some reluctantly talked of threats and about the police and underworld nexus of the fake stamp sellers. As far as the stock market was concerned, the National Securities Depository Ltd (NSDL) finally put the briefcasewallahs and the third floor forgers out of business by eliminating physical settlements.
A couple of years later, a colleague in another newspaper tried to follow the trail and again drew a blank. In fact, the first case relating to fake stamp paper was indeed registered in 1991, but it was never pursued.
A decade later, Telgi, the boy who started out with a stamp vending stall, would have been winning awards for creating the fastest growing business in the country if the enterprise hadnt been completely illegal.
He discovered a market just waiting to be exploited, because an inefficient government wouldnt produce enough stamp paper to meet statutory and legal requirements. Also the process of buying stamps from the government stamp office involved long queues and irritating encounters with arrogant and lazy government employees.
If Telgis business grew by leaps and bounds, it is because the authorities responsible for producing revenue stamps and stamp paper failed to collect simple statistics and check if their supply met the demand from the market place. Telgis illegal press could crank out increasing volumes of stamp paper, because official agencies werent producing enough. Did Telgis long reach ensure that official agencies remained asleep Even today, the Maharashtra government, which probably presides over the largest number of transactions requiring stamp paper in the country, has never calculated what its revenue generation from stamp duty payments ought to be. Nobody even asked, until recently, how printing machines were disposed by the governments security printing presses at Nasik and how they became available for Telgi to reassemble and use.
By 1995, seven cases had been registered against Telgi, but sources allege that it was often a means for the police officials to get on to Telgis generous payroll. The size of the fake stamp paper scam is now estimated at anywhere between Rs 20,000 to Rs 30,000 crore. Even providing for a certain amount of exaggeration, it is clear that the tentacles of its corrupting influence have spread across the country.
That the stamp paper scam is finally shaking up the corrupt police and political hierarchy of Maharashtra is tribute to the untiring effort of social activist Anna Hazare. He filed a public interest litigation demanding action against all police officials named by the Special Investigation Team headed by deputy inspector general Subodh Jaiswal when they were caught partying with Abdul Karim Telgi or shielding other corrupt officials. By preventing the scam from being brushed under the carpet, Mr Hazare not only exposed the rot in the system, but he also helped highlight the best of Indian democracy. We cannot ignore the judicial activism that gave the Special Investigation Team its freedom. And allowed the efforts of officers like Mr Jaiswal and retired additional director general of police SS Puri (who heads the SIT that ordered the arrest of 37 police officials and over a dozen politicians) to get the attention that they richly deserve.
The service they have rendered becomes apparent if you understand the environment of fear and helplessness that Telgi and his band of corrupt police officials had managed to create. Apart from the fake stamp racket, stockbroker sources insist that evasion of stamp duty continues even in the electronic mode.
A wide ranging investigation into all issues relating to the sale of stamps and collection of stamp duty is certainly called for. As many say, Telgis role in producing fake stamps, corrupting the police force and gratifying politicians is probably the tip of the iceberg.
Writers e-mail: firstname.lastname@example.org