The proposal, put forth by the civic administration, was rejected by the committee on the grounds that concession would result in a massive loss of revenue to the municipal corporation.

According to the proposal, octroi was to be charged on concessional rate at only half per cent of the cost of the product and the raw material, instead of the usual rate of 1.25 per cent. The concession would have been valid for five years. The concession could be granted for any new industrial venture. Telco had made a request in December to the corporation for granting the concession.

Municipal Commissioner B I Nagrale told newspersons that the opinion of the legal advisor was sought before forwarding the proposal for discussion at the standing committee. The main issue in the proposal was whether the production of the new car could be considered as a complete new venture of the company, he said. The legal advisor was of the opinion that the concession may be granted and therefore it was sent to the standing committee for a final decision.

The committee discussed the proposal at length and was of the view that the PCMC would face a massive revenue loss for five years. The small scale industries which provide raw material to the company would also be severely affected, a senior official said. The standing committee, meanwhile, approved a resolution for purchase of three new Maruti Esteem cars for the standing committee chairperson, the ruling party leader and the oppositon leader.

The PCMC will be incurring an expenditure of Rs 16.56 lakh for the purchase of cars. Nagrale when asked why the PCMC was going ahead with the expenditure for new cars when chief minister Vilasrao Deshmukh has already directed the corporations to curtail unnecessary expenditure maintained that the expenditure could not be considered unnecessary. The cars already in use will not be discarded but would be provided to officials, he said.

The committee also approved a resolution for purchase of medicines worth Rs one crore directly from the pharmaceutical companies to meet the urgent requirement of medicines in the the civic hospitals. There is an acute shortage of medicines at present as the process of finalising the annual tender for purchase of medicines valued at Rs one crore has been delayed by over seven months.