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( PARLIAMENTARY AFFAIRS DEPARTMENT )

 

CABINET DECISIONS

 

09.09.2004  

 1. Writing off Sales Tax on the Sale and Lease Back arrangement between erstwhile OSEB and IDC of Orissa Ltd.  Approved.   

            IDC  had taken a loan from IDCOL out of the Steel Bond Fund and utilized the same to purchase the identified assets from OSEB, which qualified for 100% depreciation under Rule-5 of the Income Tax Rules. IDC leased back the assets to OSEB at a mutually agreed lease rental. It had been assumed that the sales tax exemption would be available to the above transaction as the arrangement is between the two State Public Sector under takings. 

          The sale and lease back agreement between IDCOL & OSEB stipulated that, any tax to be levied on this transaction will be to the account of OSEB. Unless sales tax exemption is granted by Government, GRIDCO would have to pay sales tax on sale of assets amounting to Rs.4.42 crores and also on lease rental amounting to Rs.6.05 crores aggregating to Rs.10.47 crores as demanded by Sales Tax Authority. Today, the Cabinet gave its nod to write off the Sales Tax demands of Rs.10.47 crore payable by GRIDCO.  

2.            Proposal to exempt certain goods from levy of Entry Tax.  Approved.

          Post-facto approval of the cabinet was accorded  for allowing entry tax exemption in respect of following five items in the public interest.

                              Sl.No.                          Item

                             43                          Pasteurised milk

                             64                          Jaggery and Gur

                             68                          Cycle, Cycle Rickshaw and

                                                           their Spare parts.

                             77                          Dal and pulses

                             80                          Dry Fish

          Exemption Notification  under Section 6 of the Entry Tax Act has already been issued vide Finance Deptt. Notification No.24087 dated 01.06.2004.

3.            Rationalization of Sales Tax Rates.   Approved.

          As per the existing provision, exemption of Sales Tax is admissible on the sale of handicraft goods only when these are sold through authorized sale outlets of Co-operatives/Government Agencies/KVI Commission/Board/Coir Board & Handicraft Corporation.

          In order to encourage the sale of handicraft products manufactured in the State as well as the artisans engaged in production of such handicraft items in an uniform manner, the relevant provision in the existing Finance Deptt. Notification has been amended w.e.f. 26.02.2004 by which sale of handicraft goods manufactured in the State of Orissa has been exempted from levy of Sales Tax without any stipulation/condition.

          This will benefit both the organized sector as well as individual artisans producing handicraft goods.  

4.            Framing of Rules regulating method of recruitment and conditions of service of Accountants, Accounts Superintendents and Assistant Controller of Accounts in the office of the Controller of Accounts, Orissa, Bhubaneswar.

                        This has been approved by the Cabinet.  Formal clearance of OPSC is to be obtained following which the Rules can be notified.

 5.         (A)      Amendment of provisions of IPR, 2001 relating to (i) Mega Projects and (ii) Negative List.   Approved.

            (B)      Special Incentives for Mega Projects.   Approved.

          In order to attract investments in Mega Sector Projects specially on no mineral sectors, IPR 2001 needs amendment for defining Mega Projects on various Sectors and also extending special incentives keeping in view the overall situation prevailing in neighboring States otherwise our State will loose competitiveness in attracting large scale investments. Besides certain projects with huge investment like Oil Refining with/without solvent extraction facility and manufacture of spice with spice mark or AG mark products, are felt necessary to bring under eligible list to bring out a rationality in all types of projects. It is decided that the incentives to be extended to Mega Projects are (1) Special Industrial Promotion Assistance linked with Sales Tax. (2) Exemption from entry tax for into ports through Orissa Ports from Foreign Countries. (3) Concessional C.S.T. for inter-state sale.

6.            Functioning of Single Window System for setting up Industries in the State.  Approved.

          The Orissa Industries Facilitation Act 2004 aims to promote Industrial Development and facilitate new investment by simplifying the regulatory framework and by providing for an investor friendly environment in the State.

          It was felt that expeditious clearances of proposals relating to setting up of Industries is of prime importance and therefore, Single Window Concepts was introduced in IPR-2001. This concept will facilitate speedy implementation of Industrial and other projects in the State by providing a single point guidance, assistance to promoters, reducing procedural requirements, rationalizing documents and minimizing inspection. For successful implementation “Shilpa Jyoti” a contact point in IPICOL for Large and Medium projects and “Shilpa Sathi” in all DICs for SSIs and Tiny Sectors will provide required services to the promoters and also these contact points will have interaction with various agencies and authorities for obtaining necessary clearances and removal of bottlenecks. State Government’s nodal agency IPICOL will facilitate setting up of Large and Medium Industries in the State and DIC will function as Nodal Agency for Small & Tiny Industries.  

7.            Amendment of Orissa Industries Service Rules, 1985.   Approved.

          In Orissa Industries Service Rules, 1985, four years service experience has been prescribed for promotion from Class-II to Class-I (Jr.), Class-I (Jr) to Class-I (Intermediary) and Class-I (Intermediary) to Class-I (Sr) of J.D.I. Subsequently the post of JDI has been bifurcated into two grades such as JDI Level-II and JDI Level-I as per F.D. Resolution No.32242/F. dated 22.8.1985. But, no separate criteria for recruitment to the post of JDI Level-II and Level-I has been prescribed in the OIS Rules, 1985. It has, therefore, been decided by Govt. that four years of service experience in the grade of Class-I (Intermediary) would be necessary for promotion to JDI Level-II. Similarly, one year service experience in the grade of JDI Level-II for promotion to JDI Level-I would be necessary.

8.            Amendment of thep Orissa Lokpal and Lokayuktas Act, 1995 (Orissa Act 8 of 1995).  Approved.

          The pay and other perquisites of the Lokpal are fixed keeping in view the pay and other perquisites of the Chief Justice of Orissa High Court as per the provisions of Orissa Lokpal and Lokayuktas Act, 1995 with effect from 29.08.2003, being the date from which the present Lokpal have been holding office. The salaries of judges of the High Courts have been revised after the 5th Pay Commission Report. The Cabinet accordingly decided that the pay of the Lokpal should be fixed equal to the pay of Chief Justice of Orissa High Court and the pay of the Lokayukta should be equal to the pay of a judge of the High Court. It has been decided to amend the Act accordingly.

9.            Proposal to file the Certificate Cases on deferred payment basis without paying the Court fee at the beginning by the OSIC Ltd.   Approved.

            The Orissa Small Industries Corporation Ltd. is a State Govt. undertaking and its dues have been declared Public Demand by Revenue Department. The Corporation wants to file Certificate cases to realize Rs.7,13,26,306.22 under OPDR Act and for this purpose the Corporation shall have to pay Rs.21,82,995/- as cost of Court fees to realize the said amount. As the Corporation is facing sever finance hardship it has been proposed that OSIC should file the Certificate Cases on deferred payment basis without paying the Court fee at the beginning. But after recovery of the amount from the Certificate Debter, the value of the Court fee shall be realized by the concerned Certificate Officer.

10.      Lease of Govt. land in favor of the North Orissa University, Sriram Chandra Vihar, Takatpur, Baripada.  Approved.

          The Registrar, North Orissa University has applied for lease of Government land of Ac.98.84 in village Hemachandrapur and Maharajpur under Baripada Tahasil for construction of North Orissa University Campus free of premium which comes to Rs.8,60,78,931/-.

          As the North Orissa University has been established to cater to the higher education needs of Mayurbhanj and Keonjhar districts, Revenue Department have proposed to exempt premium payable by the University.

11.            Proposal for a validating legislation to regularise the adhoc appointment of one Assistant Director in Group-B Service of Textile Cadre who was initially appointed as Stipendiary Engineer (Textile).  Approved.

          To regularise the Adhoc appointment of Sri O.K. Gantayat, Assistant Director (Textiles) is appointed as Stipendiary Engineer (Textile) through validation Act.  

12.            Appointment of Shri Pratip Kumar Mohanty, IAS (Retired), Ex-Chief Secretary, Orissa, as Member, Orissa Public Service Commission against a vacant post.   Approved.

  13.      Re-constitution of Cabinet Sub-Committee for formulation of allotment of Land Policy in respect of Bhubaneswar and reviewing the matter of unauthorized constructions.  Approved.

            After General Election to the State Legislative Assembly in April, 2004 a new Council of Ministers assumed office. Hence, it was felt necessary to reconstitute the Cabinet Sub-Committee with following Members :

1.   Minister,  Revenue, Food Supplies & Consumer Welfare  .....          Chairman

2.   Minister,  Urban Development and   Public Enterprises   .....          Member

3.   Minister,    Finance                                                 .....          Member

4.   Minister,   Panchayati Raj & Culture                           .....          Member

5.  Minister,  Works & Housing                                        .....          Member

                     The Cabinet has accorded post-facto approval to the same.

 14.            Proposal for amendment of the Orissa Motor Vehicles Taxation Act, 1975.  Approved.

            The Orissa Motor Vehicles Taxation Act, 1975 was enacted in the year, 1975 with the object to provide unified law relating to imposition of Tax and Penalty on Mtor Vehicles. The provision of section-4A of the said Act was amended during 2003 (Orissa Act-8 of 2003) for imposition of one time tax @ 5% of the cost of the vehicle on personalised vehicles. This amendment was aimed to fetch additional revenue to the State Exchequer. However, functioning of the amended provisions of the said Act has shown that the desired result has not been achieved due to certain deficiencies in the amended provisions of the said Act. The Cabinet, therefore, decided to bring further amendment under section-3, 3A, 4 & 4A of the said Act with a view to augment collection of more revenue to the State Government.