The prime minister's office sent the proposal for repealing the controversial act to the president on Tuesday. The president is expected to promulgate an ordinance this week.

The reformed guidelines by way of repealing the Act would bring in larger inflow of funds from the private sector and provide more land for the building industry.

According to sources in the ministry of urban affairs and employment, the government is also likely to introduce new guidelines for the housing industry as suggested by the parliamentary standing committee in the Act, so that the market forces do not misuse the opening up of the housing sector, sources said.

During the last session of the Parliament, the committee recommending the repeal of ULCRA had insisted that the interests of the weaker sectionsof the society be protected.

The committee was of the opinion that after repealing the Act, the market forces would have a free hand in deciding the land prices but the vulnerable sections could not be left at the mercy of these forces.

To safeguard the interests of the poorer section, the government is also planning to create a `shelter fund'. It would be mandatory for the private parties entering the housing industry to contribute a part of their earnings to the proposed fund.

Similarly, they would be asked to provide reservation to such sections in the housing stock built by the private builders.

The sources also believed that with the promulgation of the ordinance, the state governments will be asked to modify their urban development land and building bye-laws in accordance with the new amendments.

The ministry also plans to levy a corporate tax on the land owners to plug the misuse of the vacant land.

With the abolition of the ULCRA, nearly 200,000 hectares of land will be released to theprivate sector and land prices are expected to crash heavily in Delhi and neighbouring states of Haryana and Punjab. The property prices are also expected to witness a sharp fall in almost all the union territories since the ordinance will be immediately effective in these areas.

The Punjab and Haryana governments have already given their consent to the repeal of the Act. Since the land is a state subject, the other states will have only three options: to abolish the state land ceiling act, not to repeal the act and to amend the current legislation.