I disagree. If you place your finger right on the fret you will be dampening the note to some extent. IMO proper technique requires the finger to be placed immediately behind the fret so that the string can ring unimpeded from the fret to the bridge.
It's only "proper technique" if you think that full sustain and full overtones are proper, for every application, always. However, they rarely are, IMO and IME.
Firstly, the damping effect is slight. It's audible, and important...but not major. You aren't turning a "ring" into a "thud" by doing it. You're just creating a more controlled, cleaner sounding ring.
Secondly, you speak of that damping as if it's a bad thing across the board. It isn't. It makes you sound
better in many applications – most, IMO. It's just that most people have never learned to use this technique, and use only right hand damping.
So, what you describe is not simply "proper technique." It's "a technique." It's a technique that you use
if you want zero damping whatsoever. That's something to be used as called for, but it's not a character of note that I want to employ as the default whenever I play. Quite the opposite; it's a rare exception when I want that.
To my feeling of what a "standard bass note" sounds like, full sustain and full overtones are dialed back, as the baseline. I.e. there is a mild degree of damping as your "home base," and you can either damp more or damp less, as called for. But the baseline is the ever so slightly slightly damped character that you get with finger on fret. This creates an effect that is very "normal" for an instrument that is playing a rhythm role in an arrangement. It is preferable to dial back the full sustain and full overtones, in a great majority of applications.
I play on the frets, and deliberately control my left hand pressure, and position to some degree, constantly, in order to control the level of built in damping, especially on my basses that don't have bridge mutes. I even do this on open strings whenever possible, playing in 0 position, fingering at the nut to provide that slight damping. If I am playing open strings along with notes higher on the neck, and can't make it down to the nut to do this, then I drag my thumb a bit to help accomplish a similar effect. If I want full sustain and overtones, I fret as you describe...but in 30+ years of playing bass, very few gigs and compositions have called for that "totally wide open" sound.