Panel favours granting 5-year tax holiday to HSL

NEW DELHI: A Parliamentary committee has favoured granting a five-year exemption from paying central excise duty to loss making PSU Hindustan Salts and increased equity participation by the Centre to pull the company out of the red. "The government should grant the tax holiday in respect of central excise duty as requested by the company in view of the poor financial health of the company. It had also recommended that government take up the matter regarding sales tax exemption with the state govenrment at the highest level immediately," the committee said. The Committee on public sector undertakings, chaired by Vijay Kumar Malhotra, in its report tabled in Parliament today said government should support the company by equity particiaption through conversion of plan and non-plan loans into eqity instead of merely extending loans to the company. This was particularly important since the PSU which has been declared as a sick company would require strengthening of its financial position to turn itself into a viable entity for a suitable joint venture formation. Also, since the government intends to procure four MT of edible salt from HSL and its subsidiary Sambhar Salts Ltd for the ''Antodaya'' scheme, the committee has asked government to expedite the process for distribution of salt under the scheme. The committee has also said there was a strong case for protecting the domestic industry by imposing anti-dumping duty on bromine since one of the main factors for the declining profitability of the PSU was decline in bromine production coupled with increase in import of the product.