The Office of Citizenship and Immigration Services has said that the congressionally mandated cap of 65,000 H-1B visas has been reached less than five months into Fiscal Year 2004 (which began October 1,2003) and hence no more applications would be accepted.

The USCIS, which is now a division of the Department of Homeland Security after Congress closed down the erstwhile Immigration and Naturalization Service, said certain procedures for the remainder of FY 2004 had been implemented.

All first-time employment petitions received by February 17 will now be processed while those received after this date would be returned along with the filing fee.

It said petitioners could re-submit their papers when the H-1B visas become available for FY 2005,which begins on October 1, 2004, and April 1, 2004, is the earliest date at which such applications could be filed.

The USCIS said petitions for current H-1B workers do not count towards the congressionally mandated cap and accordingly, these applications would continue to be processed.

These would include the extension of H-1B visas, which is an additional three years to the initial three years for which a visa is issued; a change in terms of employment for the current H-1B visa holders; applications that would allow for current H-1B workers to change employers; and applications that would allow for current H-1B workers to work concurrently in a second H-1B position.

The USCIS also noted that "petitions for new H-1B employment are not subject to the annual cap if the alien will be employed at an institution of higher education or a related or affiliated nonprofit entity, or at a non-profit research organisation or a governmental research organisation."

India has traditionally provided the bulk of H-1B workers -- over 40 per cent, primarily in the information technology sector -- but in recent years with the slump in the US economy and with jobs being outsourced, the program has become controversial with many lawmakers, both Republican and Democrat, calling for its elimination.

In 2000, when demand was at its height and the information technology sector was experiencing a boom, Congress responding to the lobbying of the high-tech industry increased the cap from 65,000 to 195,000. But that increase expired on September 30, 2003 and the cap was reverted to 65,000.

Since the economy was in the doldrums, and the Internet bubble had burst, the high-tech industry, which was the driving force behind the increase in H-1B visas was lukewarm in its efforts to retain the increased cap and the few lobbying efforts fell by the wayside as the Congressional environment was not conducive to maintaining the 195,000 limit.

Some groups like the American Immigration Lawyers Association argued that the cap be at least made 115,000, arguing that H-1B workers, who not only constitute IT workers but nurses and other highly skilled professionals are vital to keep the US economy going, but Congress was in no mood to acquiesce to their pleas.