Hello All. By the discussions above I am getting the feeling that the problem is that I haven't been able to read the RPM.

WRONG!!

I have been able to read the RPM. Which means that I have made all the calculations for No. of cylinders, bla bla bla and AM reading the correct RPM. The only problem is that I need a solid place to touch my wire.
All this is done with the wire hanging near the ignition coil.

One of you mentioned "and older ones inductive sensor. They triger high voltage coil.
"

Does the primary coil of the ignition coil get feed through a relay as well ??? Keep in mind that the primary coil is operated through 12V and its connection is broken at spark time.

I am using a transistor for feeding pulses to the uC. Is it necessary that I use an opto-coupler, or will a transistor do ??

So by above discussion it seems that all I am lacking in is LM323 (supply filtering) and a RC / L filter for input to uC.

Someone also suggested tapping the alternator. I am not sure what I am going to get from that (perhaps DC voltage ???). I am not sure about its working principle.

Perhaps you can guide me to a website which will make the principle more clear to me and help me pick the easier and accurate way.

Thanks all of you...keep writing....

Regards
Aman