Election budget writes off farmers’
loans, raises IT exemption
Defence budget crosses Rs 1 lakh crore mark
Sixth Pay Commission to submit report by March
Rs 16,000 crore for NREGA, Rs 2000 cr for minorities welfare

NEW DELHI, Feb 29: In an election budget that gives largesse to different sections, Finance Minister P Chidambaram today announced a waiver of agricultural loans to the tune of Rs 60,000 crore, raised the income tax exemption threshold to Rs 1,50,000 and slashed customs and excise duties on variety of goods.

Presenting his fifth and last full-fledged budget, he also withdrew the controversial banking cash transaction tax but introduced a Commodities Transaction Tax on the lines of Securities Transaction Tax on options and futures. The Central Sales Tax was reduced from three to two per cent.

Under the income tax proposals that will give a minimum relief of Rs 4,000 to all assessees, incomes between Rs 1,50,001 and Rs 3,00,000 will be taxed at 10 per cent, those between Rs 3,00,001 and Rs 5,00,000 will be 20 per cent and above Rs 5,00,001 will be 30 per cent.

Senior citizens will pay no tax up to Rs 2,25,000 and women up to Rs 1,80,000. There will be no change in the corporate income tax or the surcharge rate.

While Chidambaram’s direct tax proposals are revenue neutral, those on the indirect taxes side are estimated to result in a loss of Rs 5,900 crore.

Raising the Defence budget by 10 per cent from Rs 95,000 crore to Rs 105,600 crore in the coming year, the estimates of Plan expenditure have been fixed at Rs 2,43,386 crore which will be Rs 32.4 per cent of the total expenditure. Non-Plan expenditure has been estimated at Rs 5,07,498 crore.

The revenue deficit for the current year will be 1.4 per cent against the budget estimates of 1.5 per cent and the fiscal deficit will be 3.1 per cent against an estimate of 3.3 per cent.

Revenue receipts for 2008-09 are projected at Rs 6,02,935 crore and revenue expenditure at Rs 6,58,119 crore.

Consequently, the revenue deficit is estimated at Rs 55,184 crore, which amounts to one per cent of GDP. The fiscal deficit is estimated at Rs 1,33,287 crore which is 2.5 per cent of GDP.

Chidambaram said he would not only achieve the target for fiscal deficit under the Fiscal Responsibility and Budget Management Act but also meet the target of annual reduction of 0.5 per cent in the case of revenue deficit.

"However, because of conscious shift in favour of health, education and the social sector, we may need one more year to eliminate the revenue deficit. In my view, this is an entirely acceptable deferment," he said.

In cheerful news to the Central Government employees, he announced that the Sixth Pay Commission will give its report by March this year.

Faced with problem of farmers’ suicides on account of indebtedness, the Finance Minister announced a scheme of debt waiver and relief under which all loans upto March 2007 and overdue upto December last will be covered. Three crore small and marginal farmers will benefit to the tune of Rs 50,000 crore by the waiver while the one-time settlement for other farmers will cost Rs 10,000 crore.

On the indirect tax proposals side, he made no change in the peak rate of custom duties while reduced it on project imports from 7.5 per cent to five per cent. He also proposed to impose a four per cent special countervailing duty on a few specified projects in the power sector.

Manufacturers of sports goods and exports of gems and jewellery, helicopter simulators, domestic fertiliser production will get customs duty sops.

On the excise side, the general Central Value Added Tax (Cenvat) rate on all goods has been reduced from 16 per cent to 14 per cent to give a stimulus to the manufacturing sector.

"The manufacturing sector is the backbone of any economy. It is consumption that drives production and it is production that drives consumption," the Finance Minister said justifying the reasons for reduction in Cenvat.

Goods in pharmaceutical sector, buses and chassis, small and hybrid cars, two-wheelers, paper, paperboard, compositing machines, wireless data cards, packaged coconut water, tea and coffee mixes and puffed rice will become cheaper while non-filter cigarettes will become costlier.

Bulk cement will now attract excise duty of Rs 400 per tonne and cement clinkers Rs 450 per tonne. Packaged software will attract a lesser excise duty of eight per cent from the existing 12 per cent to bring it at par with customised software.

The service tax is being extended to four more services including asset management service provided under ULIP, services provided by stock and commodity exchanges and clearing houses, right to use goods where VAT is not payable and customised software.

The threshold limit for exemption for small service providers will be increased from Rs 8,00,000 per year to Rs 10 lakh per year as a result of which 65,000 small service providers will go out of the tax net.

In a bid to give relief to corporates and firms, creche facilities, sponsorship of employee-sportsperson, sports events for employees and guesthouses will be exempted from the Fringe Benefit Tax.

While Chidambaram announced measures to expand the market for corporate bonds, he extended the requirement of the Permanent Account Number (PAN) to all transactions in the financial market, subject to threshold exemption limits.

With the Commonwealth Games just 947 days away, the budget provides Rs 624 crore for building infrastructure facilities. A five-year tax holiday has been proposed for two, three and four hotels in districts which have UNESCO-declared world heritage sites.

A similar tax holiday has also been provided for building hospitals anywhere in India, especially in small towns.

The Finance Minister has doubled the outlays for the Ministry of Minority Affairs to Rs 1,000 crore in 2008-09 for speedy implementation of the recommendations of the Justice Rajindar Sachar Committee for minority welfare. Besides, Government will contribute additional equity of Rs 75 crore to the National Minorities Development and Finance Corporate.

Giving a thrust to water resources and irrigation projects, the budget provides Rs 100 crore as initial corpus for establishing the Irrigation and Water Resources Finance Corporation.

Food subsidy under the Public Distribution System will cost the Government Rs 32,667 crore. Smart cards will be used for delivery of this subsidy in Haryana and Chandigarh on pilot basis.

Considered as a dream project of UPA chairperson Sonia Gandhi, the Finance Minister has provided Rs 16,000 crore for the National Rural Employment Guarantee Scheme (NREGS) which will be extended to all 596 rural districts in the country.

For skill development, the Government proposes to establish a non-profit corporation. While Rs 15,000 crore will be garnered from Governments, Rs 1,000 crore will be provided as government equity from this year’s budget.

For Bharat Nirman, the flagship programme of the UPA Government, Chidambaram increased the allocation to Rs 31,280 crore against Rs 24,603 crore in 2007-08. The total allocation for the education sector has been increased by 20 per cent to Rs 34,400 crore from Rs 28,674 crore.

For encouraging careers in Science and Research and Development, the Ministry of Science and Technology will introduce a scheme - Science Pursuit for Inspired research (INSPIRE). The budget provides Rs 85 crore for this initiative.

For taking the information technology to rural areas, a new scheme for State Data Centres has been approved. The budget provides Rs 275 crore for these centres. Besides Rs 450 crore has been earmarked for the State Wide Area Networks (SWAN).

Chidambaram said for financial inclusion, the commercial banks including Regional Rural Banks would be advised to add at least 250 rural household accounts every year at each of their rural and semi-urban branches.

He proposed to create a fund of Rs 5,000 crore in NABARD to enhance its refinance operations to short-term cooperative credit institutions. Two funds of Rs 2,000 crore each in Small Industries Development Bank of India (SIDBI) would be launched of which one would be for risk capital financing.

India’s defence spending will for the first time ever cross the Rs one lakh crore mark with the Government today announcing a 10 per cent raise in the allocation for the year 2008-09.

In a clear signal that there would be no let up in the ongoing mammoth modernisation drive of the armed forces, Chidambaram said that the defence allocation for the coming year would be Rs 1,05,600 crore, a hike of 10 per cent from last year’s allocation of Rs 96,000 crore.

But in actual terms, the hike is 14.16 per cent as that of last year as the Defence Ministry could only spend Rs 92,500 crore, leaving a sum of Rs 3,500 crore unspent, apparently due to two major contracts for purchase of helicopters and 155 MM artillery guns not going through.

It was amply clear that the budget will focus on continuing upgradation of armaments with the allocation on capital outlay running into Rs 48,007 crore, a jack up of almost 23.3 per cent over last year’s outlay of Rs 37,705 crore.

Capital estimates last year were Rs 41,922 crore of which the Defence Ministry only spent Rs 37,705 crore.

Though there was substantial hike in defence budget, India’s defence spending continued to be below two per cent of the GDP far less as compared to Pakistan’s 5 per cent and China’s almost 7 per cent.

Over the past few years under the modernisation programme the Army has inducted new frontline tanks, UAVs, missiles and new infantry weapons, while, the Navy has received stealth warships, missiles and submarines.

The working class people will stand to benefit by up to Rs 44,000 a year in income tax following the changes proposed by the Finance Minister in the Union budget for 2008-09, which also provides for a minimum benefit of Rs 4,000.

While raising the income tax exemption limit to Rs 1.5 lakh from 1.1 lakh, Chidambaram also provided for lower tax rates for income up to Rs 5 lakh.

For an income of Rs 10 lakh a year, an individual would have to pay a tax of Rs 2,05,000, as against Rs 2,49,000 under the previous tax structure. For women assessees, a similar income would attract a tax of Rs 2,02,000 under the new regime, down from Rs 2,45,500 previously, while the tax for senior citizens would drop to Rs 1,97,500 from Rs 2,36,000 earlier.

The minimum benefit to a person with an annual income of Rs 1.5 lakh at the threshold will be around Rs 4,000, Chidambaram said, while presenting the budget 2008-09 in Lok Sabha.

According to the proposals, income between Rs 1.5-3 lakh will be taxed at 10 per cent, between Rs 3-5 lakh at 20 per cent, while for Rs 5-10 lakh it would be 30 per cent.

Based on this structure, an individual having an income of Rs 10 lakh would pay no tax on income up to Rs 1.5 lakh, Rs 15,000 between Rs 1.5 lakh to Rs 3 lakh, Rs 40,000 between Rs 3-5 lakh and Rs 1,50,000 between Rs 5-10 lakh. Previously, the tax amounts for these four slabs were Rs 4,000, Rs 35,000, Rs 60,000 and Rs 1,50,000 respectively.

The tax benefit when compared to the previous regime would be higher for male assessees, as compared to women and senior citizens.

While men with an annual income of Rs 10 lakh stand to gain Rs 44,000, the same for women and senior citizens with similar income is Rs 43,500 and Rs 38,500 respectively.

In case of women assessees with annual income of Rs 10 lakh, the tax amounts for income slab of up to Rs 1.8 lakh would be nil, Rs 12,000 between Rs 1.8-3.0 lakh, Rs 40,000 for Rs 3-5 lakh and Rs 1,50,000 for Rs 5-10 lakh. Earlier, the tax rates for these slabs stood at Rs 6,500, Rs 29,000, Rs 60,000 and Rs 1,50,000 respectively.

For senior citizes with similar annual income, the tax for income up to Rs 2.25 lakh would be nil (Rs 6,000 previously), Rs 7,500 (down from Rs 20,000) for Rs 2.25-3.00 lakh, Rs 40,000 (down from Rs 60,000) for income between Rs 3-5 lakh and Rs 1,50,000 for income between Rs 5-10 lakh (unchanged).

However, those with income in excess of Rs 10 lakh would continue to attract an additional surchange of 10 per cent.

Chidambaram also introduced an additional deduction of Rs 15,000 for taxpayers towards payment of medical insurance for parents. This would be in addition to the Rs 1 lakh limit for savings under Section 80C of the Income Tax Act. (Agencies)

AE’s 4 houses raided
Vigilance suspects leakage of info

By Sanjeev Pargal

JAMMU, Feb 29: Conducting its third operation against corruption in less than a week, the State Vigilance Organisation (SVO) today found that either the information about raid on the house of an Assistant Engineer had been leaked or he had alerted himself from two previous raids, a result of which the anti-corruption sleuths couldn’t lay hands on most of the documents which, according to their information, should have been in the house of the official.

The SVO sleuths today carried out simultaneous raids in four residential premises of Javaid Ahmed, Assistant Engineer, PHE sub division in Ramban district but failed to get documents pertaining to his bank accounts, LIC policies etc, which they were expecting, official sources said.

Pleading anonymity, a senior officer of the Vigilance Organisation admitted that their operation was "not as successful as they were expecting". Nevertheless, he said, there were many other ways to extract details of bank accounts, LIC policies, FDRs and other documents.

"We are going to approach the banks and other concerned authorities for the details", he said.

Javaid Ahmed couldn’t be arrested or detained for questioning as he was away in Gool where he was posted.

Sources said either the information of simultaneous raids on Ahmed’s house had been leaked or he had alerted himself from two successful raids conducted by the SVO in less than a week unearthing huge assets of a Tehsildar and a Scientific Assistant.

On February 23, the Vigilance Organisation had raided residential and office premises of Tehsildar (Recovery), Jammu, Janak Singh and on February 25, it carried out similar raids on the premises of Abdul Rahim Shah, a Scientific Assistant in the office of Directorate of Environment, Ecology and Remote Sensing, Srinagar.

Property worth Rs 3 crore was detected during raids on Janak Singh’s house while Rs 1.5 crore worth assets of Abdul Rahim Shah have been unearthed.

The houses of Javaid Ahmed were raided by the Vigilance teams simultaneously this morning at Masjid Mohalla, Kishtwar, Thakrai, Kishtwar, Maryani Talab, Narwal Bala and a rented house at Gujjar Nagar. The operation was supervised by SSP Vigilance (Udhampur-Kathua) range Nissar Ahmed.

Presently, the AE was staying in the rented house of Dr Bashir Ahmed Mintoo at Gujjar Nagar for which he was paying a monthly rent of Rs 4000, sources said, adding he was constructing a huge double storey house comprising 10 bed rooms, two lobbies, nine bathrooms, two store rooms and two verandas. His house in Kishtwar was constructed on one kanal six marlas of land while the Engineer had spent a lot of money on renovating his ancestral house at Thakrai.

He had a Santro car bearing No. 9898 JK02S, which was registered on the name of his mother-in-law.

Sources, however, said, even this much of property was disproportionate to legitimate sources of income of the AE. A case under Section 5(2) Prevention of Corruption Act has been registered against the AE. Sources added that efforts were being made to ascertain "true wealth" of the engineer.

Meanwhile, the SVO today produced two challans against the officials of Revenue and SRTC officials under the provisions of Prevention of Corruption Act in the courts of Special Judge Anti Corruption, Srinagar and Jammu.

Challan against Ghulam Qadir Bhat, Patwari Halqa Khoshipora/Zainkoot, Srinagar was produced in the court of Special Judge Anti Corruption, Kashmir in Srinagar, who was caught red handed while accepting a bribe of Rs. 3000 for mutation of land in favour of his cousins. The money was recovered from the Patwari in presence of independent witnesses at his residence.

The SVO also produced Challan against Suraj Prakash, Mechanical Inspector, SRTC Jammu in the court of Special Judge, Anti Corruption, Jammu for misappropriation of Rs 1,26,800 received on account of vehicle inspection fee from the owners of the accidential vehicles. The case was registered in 1999.

Immigration clearance denied to a tax defaulter
893 IT evasion cases unearthed in Valley

By Mohinder Verma

JAMMU, Feb 29: The Income Tax Department’s first ever initiative to compare data-base of the traders available with the Commercial Taxes Department is all set to tighten the noose around the ‘habitual’ tax evadors in the State with the Department unearthing around 893 cases of tax evasion in Kashmir division.

The information collected by the Income Tax Department in respect of 3500 traders of Jammu region having turnover of Rs 40 lakh is being cross-checked to verify whether they are filing Income Tax returns or not.

Disclosing this to EXCELSIOR, Income Tax Commissioner, J&K Circle Virendra Singh said that the comparison of data-base available with the Commercial Taxes Department revealed that out of 1345 traders filing VAT returns and declaring turnover in excess of Rs 40 lakh, only 452 were filing Income Tax returns.

"In the remaining 893 cases, the Income Tax returns were not being filed and majority of them were indulging in illegal practice of evading tax", he said, adding "the process to issue notices to such traders has already begun".

Not only for the recovery of Income Tax, these cases would also be monitored for the payment of Advance Tax the last date for which is March 15, Mr Singh said, adding to avoid action on the part of Income Tax Department such traders should file their Income Tax returns without wasting much time.

In case, they failed to file IT returns and pay last installment of the Advance Tax on or before March 15, they will have to face stern action which may include attachment of properties, the Income Tax Commissioner warned.

"The verification of 3500 cases of Jammu region will be completed within next few days following which the non-filers of the Income Tax returns and advance tax will be dealt with sternly", he said.

It is worthwhile to mention here that before initiating this exercise the Income Tax Department had constituted task force—one each for Kashmir and Jammu divisions.

The Department has decided to take up recovery drive in right earnest and will take cohesive measures in case the assesses fail to come forward to pay tax voluntarily.

The intentions of the Department can be well gauged from the fact that it got the immigration clearance denied to a businessman from Jammu by sounding concerned authorities at Indira Gandhi International Airport, Delhi, the sources said.

"The Income Tax Department has asked the businessman to pay the due income tax at the earliest to undertake journey to a foreign country", they said and didn’t rule out the possibility of adopting such measures in other cases too.

The Department has appealed the tax evadors to come forward voluntarily and fulfill their legal obligation of declaring the real income and paying tax accordingly.

Meanwhile, the Department was aiming at net tax collection of above Rs 525 crore during the financial year 2007-08 as against just Rs 180 crore two years back. The official figures revealed that the Department has collected above Rs 350 crore net tax till January 31, 2007 and it is all set to achieve the target of record tax collection during the financial year 2007-08.

Major setback to HM in south Kashmir
4 militants killed in Shopian

From Ahmed Ali Fayyaz

SRINAGAR, Feb 29: In a major setback to Hizbul Mujahideen in south Kashmir, Police and Army have killed four Kashmiri militants in an overnight gunbattle at Saidpora in Shopian district.

Informed sources told EXCELSIOR that Pulwama Police and troops of Rashtriya Rifles 44 Bn launched a cordon-and-search operation in an open orchard area at Saidpora, in close vicinity of the district headquarters of Shopian in south Kashmir over a specific information last evening. Four militants of Hizbul Mujahideen were, according to the tip off, hiding at the isolated house of one Mohammad Shaban Sheikh S/o Abdul Gafoor Sheikh.

As soon as men of the Special Operations Group (SOG) of J&K Police and troops of RR 44 Bn swooped on the target house, the holed up militants opened fire and made sustained efforts to escape from the cordoned locality. Troops installed diesel generators and maintained a tight cordon till 0900 hours this morning when all four of the holed up militants got killed in a fierce gunbattle.

Even as residents insisted that one of the four killed, namely Sayyar Ahmed Thokar of Chak Cholan was a civilian, Additional SP Pulwama, Abdul Qayoom, maintained that all four were armed militants. He said that 3 AK-47 rifles and a Sniper rifle were recovered from possession of the militants killed. He said that the militants killed in the operation had been identified as Sayyar Ahmed Thokar and Riyaz Ahmed Thokar alias Abu Jihad of Chak Cholan, Sayyar Ahmed Bhat of Kilbal and Mohammad Iqbal of Udoora, Shopian.

According to Mr Qayoom, Sayyar Ahmed Thokar of Chak Cholan had formally joined Hizbul Mujahideen as late as on February 27 while as his neighbourer Riyaz Ahmed Thokar had been actively working as a militant since April last year. He, however, said that Sayyar Ahmed Bhat of Kilbal was a member of Al-Badar Mujahideen. Mr Qayoom claimed that neither security forces nor civilians suffered any damage in the 18-hour-long operation.

Officials said that the killing of four militants was a major achievement for security forces and simultaneously a significant setback for Hizbul Mujahideen which had already lost a number of its cadres and commanders in Police and military operations in south Kashmir in the last two years.

Border Security Force (BSF) has meanwhile claimed to have apprehended a militant of Al-Badar outfit, namely Mushtaq Ahmad Bhat S/o Gh Rasool R/o Kalaroos, Kupwara, alongwith one Chinese pistol.

An official spokesman said that a 10-year-old boy, namely Qadafi Manzoor S/o Manzoor Ahmad Rather R/o Marazi Mohalla, Chitti Bandi, Bandipora, sustained splinter injuries while fiddling with an explosive substance he had picked up outside his village. He has been rushed to Bandipora town for medical treatment.

The spokesman said that a local recruit of Territorial Army, namely Fayaz Ahmad Bajad, S/o Ishar Bajad R/o Poshker, Kangan, has kidnapped a young woman, Sakeena W/o Nazir Ahmad Bajad R/o Kati Wangath, allegedly on gunpoint. Police Station Kangan has registered a matter of kidnapping and launched manhunt for the accused soldier.

No more stagnation in police: DGP

Excelsior Correspondent

JAMMU, Feb 29: Assuring reformation and making police more efficient in the State, Director General of Police Kuldeep Khoda today said there would be no more "stagnation" in the police department and backlogs would be cleared soon.

Speaking on the sidelines of a press conference, addressed by the DGP on the eve of the third All India Police Hockey Meet, Mr Khoda said, "there is a lot to be done in the police department and we are in the process of clearing the backlogs in the form of promotions and transfers."

"Those, who have spend more time at one post itself, are being considered and whose promotions are pending, will be done by the ending March or mid-April," Mr Khoda said, asserting that there would be no more "stagnation" in the police department ahead.

"Recently some of the pending promotions have been cleared and rest will be done soon," he said.

Besides, the DGP said Special Police Officers (SPOs), who had lost their lives while fighting militancy, were on a high agenda of the police department.

"Around 446 SPOs have sacrificed their lives till date in insurgency operations. The rehabilitation and compensation to their families is on top priority of the police department," Mr Khoda said, adding that soon there would be good news for the SPOs performing their duties tirelessly.

The police chief said due attention is being paid to the families of police martyrs.

Families of the martyrs are being paid adequate compensation and other facilities. A memorial in the honour of police martyrs has been built while different tournaments are held in their memories, he said.

Mr Khoda added that two hostels are being constructed for the children of police martyrs, hailing from far flung areas of different districts and studying here.

Families of the martyrs are being extended the benefits of several other police welfare schemes, he said.

Highlights of budget

*Rs 60,000 crore Agricultural Debt Relief Package; complete loan waiver for small and marginal farmers: 4 crore farmers to benefit.

*Rs 2,80,000 crore target set for Farm credit in 2008-09, short term croploan to continue at 7 per cent interest.

*Irrigation and water resources finance corporation to be set up, rainfed area development programme to be started.

*Rs 3,966 crore for schemes for SCs and STs. Rs 18,983 crore for schemes earmarking 20 per cent funds for SCs and STs.

*Multi-Sectoral development plans for all 90 minority concentration districts.

*All Women self help groups credit- linked to banks to be covered under Janashree Bima Yojana.

*National Rural Employment Guarantee scheme to cover all 596 rural districts.

*A National programme to be launched for the elderly .

*Rashtriya Swasthya Bima Yojana for Workers under BPL category in unorganized sector.

*A statement on child related scheme introducted in the budget for the first time.

*Mid-Day Meal Scheme to be extended to upper primary classes in all blocks.

*Special mechanism for north-Eastern Border areas.

*Government to establish 16 Central Universities.

*3 IITs and Schools of Planning and Architecture to be established.

*6,000 High Quality Model Schools to be opened.

*New Scholarship scheme for promoting innovations in science each district to have a Nehru Yuva Kendra.

*Schools in water deficient habitations to have drinking water systems.

*Subsidy on Houses under Indira Awas Yojana increased from Rs 25,000 to Rs 35,000 in plain areas and from Rs 27,500 to Rs 38.500 in Hill/difficult area.

*Rs 1000 crore provided for Aam Adami Bima Yojana.

*Allocation under Indira Gandhi old age pension Scheme increased from Rs 2392 crore to Rs 3443 crore.

*Rs 32,667 crore provided for Food subsidy under public distribution system.

*Rs 750 crore allocated for upgrading 300 ITIs.

*Six Mega Clusters planned for Handlooms, Powerlooms and Handicrafts.

*Government to provide Rs 16,436 crore as equity support and Rs 3,003 crore as loans to central public sector enterprises.

*Backward region grant fund retained at Rs 5,800 crore, Bihar, Orissa and Uttar Pradesh to get nearly 45 per cent of the amount.

*Income Tax exemption limit hiked to Rs 1,5 lakh; 10 per cent tax for Income between Rs 1.5 lakh and Rs 3 lakh, 20 per cent between Rs 3 lakh and Rs 5 lakh, income above Rs 5,00,001 to attract 30 per cent income tax.

*Exemption limited for women tax payers increased to Rs 1,80,000 and for senior citizens to Rs 2.25,000.

*No charge in corporate income tax rates and surcharge.

*No change in the peak rate of customs duty.

*Customs duty on project imports slashed from 7.5 per cent to 5 per cent.

*Duty on steel and aluminium scrap abolished.

*Excise duty on pharmaceutical sector reduced from 16 per cent to 8 per cent.

*Small cars, two and three wheelers, buses and their chassis to cost less.

*Non filter cigarettes to cost more, excise on non filter cigarettes will be at par with filter cigarettes.

*Four more services brought under service tax net.

*Threshold limit of exemption for small service providers increased from Rs 8 lakh to Rs 10 lakh.

*Customs duty on crude and unrefined sulphur brought down from 5 to 2 per cent

*Export duty on chrome ore increased from Rs 2000 to Rs 3000 per metric tonne.

*Central Value Added Tax on all goods reduced from 16 to 14 per cent.

*Central sales tax proposed to be reduced to 2 per cent from April 08.

*Excise duty on bulk cement brought on par with packaged cement; Clinkers to attract excise duty of Rs 450 per metric tonne.

*Pan made compulsory for all transactions in the financial market subject to suitable exemption limit.

*Allocation for defence increased by 10 per cent from Rs 96,000 crore to Rs 1,05,600 crore

*Revenue deficit estimated at Rs 55,184 crore Fiscal deficit pegged at 2.5 per cent of GDP (UNI)

Will budget bring early polls?

NEW DELHI, Feb 29: A populist budget providing for a massive farm loan waiver, income tax sops across the board and no additional burden on the corporate sector today prompted widespread speculation that Lok Sabha polls may be held before the end of the year, probably by October or November.

Apparently the fast-tracking of the implementation of the debt waiver and relief scheme by June this year led to political parties, including those on the side of the Government, and the industry predicting that elections are not far away.

Short of announcing the date for elections, everything else has been announced, said leader of the CPI Parliamentary Party in Lok Sabha Gurudas Dasgupta, whose party supports the Government.

Dubbing the budget as "election manifesto", BJP vice president Mukhtar Abbas Naqvi said "it is a clear signal that elections are being held early. The nature of the budget is virtual declaration of mid-term elections."

Sharing this view, noted industrialist and Rajya Sabha member Rahul Bajaj the budget has clear indicators for early elections.

In the Central Hall of Parliament, Congress MPs were discussing the possibility of early polls and joking with colleagues of other parties to get ready for the battle. However, CPI MP D Raja does not feel it points to early elections, though he concedes that the budget does have a short-term perspective on several issues.

Finance Minister P Chidambaram, the hero of day, dismissed all talk of elections saying in India elections take place every year and the budgets can be described as election budgets.

"If you have nothing else to say about the budget, then you can call it election-budget," he said in a tone tinged with sarcasm at the customary post-budget briefing.

Apart from the budget, analysts see the possibility of Government going ahead with the nuclear deal with the US, notwithstanding the serious opposition from the Left parties, without whose support it may not be able to survive, being a factor in hastening early polls.

The continuing negotiations with the International Atomic Energy Agency (IAEA) on getting an India-specific safeguards for implementation of the nuclear deal with the US and the extension given to the ambassador in Washington, despite his reluctance to serve beyond March, are seen as pointers in this direction.

Even before the budget there had been speculation in political circles whether the Government was keen on the nuclear deal that could invite withdrawal of support by the Left parties.

In that case, whenever that happens there is a cushion of at least about six months available to the Government before elections are held that could be used by the ruling coalition to get its schemes implemented ahead of possible elections, say analysts.

President Pratibha Patil, reflecting the Government view, said in her address to Parliament that she was hopeful that the Indo-US civil nuclear deal will "become possible".

"It is our hope that civil nuclear cooperation with the USA and other friendly countries will become possible," she had said.

A group of US senators, who visited India recently also reinforced the widely-held view that time was running out for the deal and that the Government has to take a final decision sooner than later.(PTI)

‘Barati’ murdered, 5 arrested

Excelsior Correspondent

JAMMU, Feb 29: A youth was murdered in a clash between two groups of a marriage party (baratis) at village Kangrail, Manwal under the jurisdiction of Jhajjar Kotli police station last night.

The victim has been identified as Ashok Kumar, 25, son of Krishan Lal R/o Manwal.

Additional SP Jammu Shakti Pathak said Ashok Kumar objected to consumption of liquor by 15 year old Anil Kumar and his associates when they were accompanying the barat from Saruinsar to Kangrail.

Irritated by good advice of Ashok Kumar, Anil Kumar along with four others attacked Ashok Kumar with wood used for cooking food and beat him to death.

Ashok Kumar died on spot. His body was shifted to Government Medical College for post-mortem.

A police party rushed to the spot and arrested all five accused involved in the killing including Anil Kumar, Pawan Kumar, Kaka Ram, who happened to be groom’s cousin, Kishore and Shoka.

A murder case has been registered against the accused.

The marriage ceremony was conducted hurriedly.

Two Indo-Pak smugglers held

FEROZEPUR, Feb 29: Police got a shot in the arm today with arrest of two wanted Indo-Pakistan smugglers and recovery of huge consignment of heroin worth Rs 25 crores in international market, which was being smuggled inside Indian territory.

In a joint Press Conference held at CIA staff headquarters here today, Deputy Inspector General (Police) Ferozepur range, R P Mittal and Dinesh Pratap SSP, told media persons that this was one of the largest recoveries by the police in this border district.

Mittal told that the police has also arrested two wanted Indo-Pakistan drug peddlers identified as Sukhpal Singh alias Sukha, resident of village Machhiwala and Sukhdev Singh, also popularly called as Sukha, resident of village Preetuwali, falling under Sadar Police Station, Ferozepur.

Mittal told that one of the arrested smugglers Sukhpal Singh alias Sukha along with his accomplice Joginder Singh had earlier been arrested by the Kapurthala police in the year 1998-99 along with huge consignment of sophisticated arms during the dark period of insurgency in the State. The police had seized 17 imported mousers from him which he had allegedly brought from Pakistan, Mittal added.

While narrating the incident, SSP told that the police got secret input about the movement of the two international smugglers that they have brought consignment of heroin from Pakistan and dumped the same along the fencing somewhere close to the Indo-Pakistan border.

SSP told that immediately after getting the information, special police team was constituted under Sub Inspectors, Major Singh and Jaswant Rai, incharge narcotics cell to track down the smugglers.

SSP said that police again got information that these smugglers would deliver the consignment to their Delhi based agent on the intervening night of February 28-29 near the border fencing. The police then laid special barrier near three villages Kamalewala, Palla Megha and Akkuwala, all situated close to the international border. At around 11 pm yesterday night, the police team stationed near village Palla Megha noticed two persons coming from Peer Barian side with the headlights on the bike on which they were travelling switched off.

The police immediately swung into action and signaled the motorcyclists to stop but they tried to flee away. The naka party chased the duo and soon overpowered them, revealed SSP.

He further told that the police team recovered 25 packets of heroin weighing 1 kg each from the bag which Sukhpal was carrying and confiscated the motorcycle.

SSP told that during preliminary investigation, the duo revealed that they had alleged links with one Molvi Araf of Pakistan who used to send them consignment of contraband.

The accused also told that they used to get in touch with their Pakistani accomplice through telephone, and the consignment was later delivered to them at decided place and time. It is also pertinent to mention that one of the arrested persons Sukhdev Singh owns piece of land close to Indo-Pakistan border near border outpost Mohhamadiwala.

However, how these smugglers managed to bring the consignment from across the fence not withstanding round the clock surveillance of BSF sleuths has to be ascertained. SSP told that these smugglers were able to duck the BSF jawans deputed along the border and brought the consignment inside India only to get into the police trap.

DIG Mittal told that all members of the police party responsible for the haul would be suitably awarded.(PTI)