VAT in Union territories gets Cabinet nod

The Cabinet today approved the promulgation of an Ordinance for bringing Union Territories of Daman and Diu and Dadra and Nagar Haveli under the purview of value-added tax.

This was decided at a Cabinet meeting chaired by Prime Minister Manmohan Singh, Information and Broadcasting Minister S Jaipal Reddy told reporters here.

The cabinet, however, deferred a decision on allowing Indian Oil Corporation (IOC) to directly charter ships for importing crude oil instead of going through Transchart, attached to the shipping ministry.

IOC wanted to make its own shipping arrangement to reduce its freight bill and improve refinery margins. This is because competitive bidding and negotiations help reduce freight which accounts for about 10 per cent of the value of imported crude.

In another decision, the Cabinet cleared Delhi's bid for the 2014 Asian Games. "Unless the government backs it, the bid will not be taken seriously. Therefore, the Cabinet has given the green signal to the Indian Olympic Association to make the best possible bid," Reddy said.

The Cabinet also approved an agreement between India and Serbia and Montenegro on cooperation in science and technology. The agreement envisages close cooperation in research projects, exchange of technology and information and setting up of joint research centres.

Besides, the Cabinet cleared the introduction of the Manipur University Bill, 2005, in the current session of Parliament. It also decided to make Manipur University, along with College of Technology, Impal, eligible for central funding.

"This will entail a non-recurring expenditure of Rs 49 crore towards providing necessary infrastructure spread over a period of three years and a recurring expenditure of Rs 11 crore per annum," Reddy said.