The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Administered Ministry: Ministry of Finance / Department of Investment and Public Asset Management
Act details
| Short title | The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 |
|---|---|
| Long title | An Act to provide for the transfer and vesting of the undertaking (excluding the specified undertaking) of the Unit Trust of India to the specified company to be formed and registered under the Companies Act, 1956, and the transfer and vesting of the specified undertaking of the Unit Trust of India in the Administrator and for matters connected therewith or incidental thereto and also to repeal the Unit Trust of India Act, 1963. |
| Act number | 58 of 2002 |
| Act year | 2002 |
| Enactment date | 17 Dec 2002 |
| Ministry | Ministry of Finance / Department of Investment and Public Asset Management |
| Department | Department of Investment and Public Asset Management |
| Jurisdiction | Central (Parliament of India) |
| Sections | 25 |
| Schedules | 2 |
| Status | Not repealed |
| Last checked on India Code | 29 Oct 2026 |
| Source | India Code, Government of India |
Summary
Summary of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Key Provisions
1. Transfer of Undertakings: - Undertaking (excluding specified): Transferred to and vested in a specified company. Transfer and vest the undertaking (excluding the specified undertaking) of the Unit Trust of India (UTI) to a specified company.
• Specified Undertaking: Transferred to and vested in an Administrator.
2. Effect of Vesting: - Includes all assets, rights, liabilities, properties, and obligations.
• Pending proceedings continue against the new entities.
3. Administrator's Role:
• Manages the specified undertaking.
• Powers include managing affairs and redeeming units.
4. Repeal and Saving: - Repeals the Unit Trust of India Act, 1963.
• Actions under the repealed Act are deemed under this Act.
5. Specified Undertaking: - Includes various unit schemes (e.g., Unit Scheme 1964, Children's Gift Plan-1970).
6. Implementation & Provisions
• Appointed Day: Set by the Central Government.
• Financial & Administrative Details: Initial capital refund, overriding effect, board of advisers, and tax exemptions.
Legislative history
Legislative History:
The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Act Title The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Act Number 58 of 2002
Act ID (India Code) 200258
Presidential Assent Date December 17, 2002
Enforcement Date October 29, 2002
Nodal Ministry Ministry of Finance
Precedent & Historical Context
1. The US-64 Financial Crisis:
o Unit Trust of India (UTI) was established in 1963 as a statutory public sector financial institution. Its flagship flagship guaranteed-return scheme, US-64 (Unit Scheme 1964), suffered severe structural deficits and liquidity issues following market downturns in 1998 and 2001.
o Statutory intervention became necessary to bailout retail investors, protect systemic stability, and restructure UTI into commercially viable and regulatory-compliant SEBI entities.
2. The Tarapore Committee Recommendations:
o High-level committees recommended repealing the overarching 1963 Act to ring-fence government-guaranteed liabilities from market-linked mutual fund assets, transferring operations under the standard Companies Act, 1956 and SEBI Mutual Fund Regulations framework.
Parliamentary Trajectory & Enactment
• October 29, 2002: The President of India promulgated the Unit Trust of India (Transfer of Undertaking and Repeal) Ordinance, 2002 (Ord. 5 of 2002) to execute the immediate split of UTI.
• Enactment: Received Presidential Assent on October 29, 2002.
• Enforcement: Enforced on October 29, 2002.
• Source: Official Records of Parliament, India Code, and Ministry of Finance (Department of Investment and Public Asset Management).