Stamp scam in Madhya Pradesh:Vendors recycle used adhesive stamps using chemicals; Bhaskar sting exposes racket

A racket similar to the infamous Telgi scam has surfaced in Madhya Pradesh, where stamp vendors are allegedly reusing adhesive stamps by washing and refinishing them with chemicals, then selling them as new. A Dainik Bhaskar’s investigation has caught the entire operation on camera, exposing how government revenue is being siphoned off daily. How the scam works: Old documents looted, stamps washed and resold Whenever an individual buys or sells property, prepares a rental agreement, or executes any legal document, they must pay stamp duty. Adhesive stamps — similar to postal stamps — are used for this purpose. But what if the “new” stamp you buy has already been used once? A Bhaskar investigation has revealed widespread fraud at the heart of the state capital, Bhopal. Gangs are stealing old documents from government offices and banks, peeling off adhesive stamps, cleaning them with chemicals, and selling them again at full price. Some well-known stamp vendors are allegedly part of this network, operating in collusion with government clerks and bank employees. Read this full report… The Bhaskar sting: Reporters buy “refinished” stamps sold as new To expose the racket, Bhaskar reporters posed as office staff and clients seeking agreement renewal. At a popular vendor’s shop, a middle-aged man carefully assessed the reporter before selling adhesive stamps worth Rs 800. The stamps looked new at first glance — but they were actually peeled off from old documents and chemically cleaned. In a second sting, the reporter went as a tenant renewing a rental agreement. A Rs 1,000 agreement was prepared on a Rs 100 stamp paper, after which Rs 900 worth of adhesive stamps were affixed. While some stamps were new, a Rs 500 stamp bore clear signs of earlier use. A faint old bank seal — “Krite Bank” — was visible beneath the vendor’s own stamp, applied strategically to hide the tear left during removal. The vendor saved Rs 500 by using a discarded stamp purchased at scrap value. Understanding Stamp Duty and Adhesive Stamps The Indian Stamp Act, 1899 governs stamp duty. Key sections include: This scam exploits the failure to properly cancel adhesive stamps in many documents. A Telgi-style scam, but with a new twist Abdul Karim Telgi’s Rs 2,000-crore fake stamp scam in the 1990s also began with reusing old stamps. While Telgi was eventually arrested, his methods seem to have inspired many “mini-Telgis” across the state. Unlike Telgi’s counterfeit stamps, this scam recycles original government-issued stamps, making detection extremely difficult. Government revenue is being quietly drained, right under the nose of authorities. How the network operates 1. Old documents stolen from offices and banks The racket begins in government departments and banks, where lakhs of old documents are stored. Over time, these documents become redundant and are pushed into storerooms. Gang members bribe clerks, storekeepers, and peons to buy these documents at throwaway prices — paying only 10–15% of the stamp’s original value. 2. Chemical experts erase seals and ink Adhesive stamps are carefully peeled off the documents. Chemical experts then use special solutions to remove the old seals, signatures, and ink. Once cleaned, dried, and pressed, the stamps look nearly brand new. 3. Vendors hide imperfections with their own seal Stamps that show minor damage or faint old marks are used on documents created at the vendor’s shop. By quickly applying multiple notary seals, vendors mask all signs of earlier use. Once stamped, it becomes nearly impossible to identify whether the stamp is old or new. Expert examination confirms the fraud Bhaskar had the purchased stamps and agreements examined by handwriting and document experts. The findings were alarming: 1. Rough texture and faint old marks The surface of the stamps was rough rather than smooth, and one stamp still bore the faint outline of an old blue seal. 2. UV light showed old adhesive Under UV light, the remnants of old glue lit up, proving the stamps were peeled from earlier documents. 3. Infrared light revealed hidden seal The Rs 500 stamp used in the agreement displayed the old bank seal (“Krite Bank”) clearly under IR light, beneath the newly applied notary seal. 4. Printing year exposed Special filters revealed printing years: some stamps dated back to 2015 and 2017 — nearly a decade old — confirming they were recycled. A scam costing the state lakhs every day By reselling used stamps at full price, the racket siphons off massive government revenue while cheating citizens. Detection is extremely challenging because the stamps are genuine — only illegally reused. The exposure raises critical questions about oversight in banks, government offices, and the stamp vending system.