thanks for your reply,
the code i used is,
vlc -vvv INPUTFILE.mpg --sout #transcode {vcodec=mp4v,acodec=mpga, vb=256,ab=64,scale=0.5} :standard{access=file,url=OUTPUTFILE.mpg}
this works fine, but if i use vlc:quit the transcoding doesnt take place properly.
what shall i do then?