Primary law, Tamil Nadu land law
The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Parliament enacted the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, Act No. 58 of 2002, dated 17 December 2002, to transfer the Unit Trust of India undertaking to a specified company, transfer its specified undertaking to an Administrator, and repeal the Unit Trust of India Act, 1963. It is deemed to have commenced on 29 October 2002. The text, current as on 6 May 2025, lists amendments by the Finance Act, 2008, the Banking Laws (Amendment) Act, 2012, the Finance Act, 2021, the Finance Act, 2023, and the Finance Act, 2025.
What the law governs
The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 reorganises the business, assets, liabilities and schemes of the Unit Trust of India. It divides them between a specified company formed and registered under the Companies Act, 1956, and an Administrator appointed by the Central Government.
The specified undertaking consists of the business, assets, liabilities and properties connected with the schemes and Development Reserve Fund identified in Schedule I. The remaining undertaking consists of the business, assets, liabilities and properties connected with the schemes and plans identified in Schedule II.
Transfer of property and obligations
On a date appointed by Central Government notification:
- The undertaking, excluding the specified undertaking, transfers to the specified company on agreed consideration, terms and conditions.
- The specified undertaking transfers to the Administrator.
- Any business, asset or property unrelated to either undertaking transfers to the Central Government.
- The Central Government has the final decision on whether an item relates to the undertaking or specified undertaking.
The transferred property expressly includes movable and immovable property, including land, buildings, tenancies and leases. It also includes cash, investments, securities, loans, records, contracts, liabilities, guarantees and units issued by the Unit Trust of India.
Effect on buyers, owners and professionals
The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 matters where land, a building, a tenancy, a lease, a contract or another property interest was held by the Unit Trust of India immediately before the appointed day. Depending on the relevant undertaking, the specified company or Administrator replaces the Unit Trust of India as the holder of the asset, right, liability or obligation.
Existing deeds, contracts, guarantees, powers of attorney, unit schemes and working arrangements continue against or in favour of the specified company or Administrator. Pending proceedings and causes of action may also continue by or against the appropriate successor instead of the Unit Trust of India.
Units and employees
Units issued under transferred schemes are treated as issued by the specified company or Administrator. Income distribution, redemption and purchase continue in the same manner as if the transfer had not occurred.
Most officers and employees serving immediately before the appointed day transfer to the specified company on the same tenure, remuneration, terms, benefits, rights and obligations, subject to the stated option not to continue.
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Common questions
Does this law transfer land and buildings owned by the Unit Trust of India?
Yes. The transferred assets expressly include land, buildings, tenancies, leases and other movable and immovable property connected with the relevant undertaking.
Who takes over an existing Unit Trust of India property contract?
Depending on which undertaking the contract relates to, it continues against or in favour of the specified company or the Administrator as though that successor had originally been named.
Did the law start on 1 January 2002?
No. The Act states that it is deemed to have come into force on 29 October 2002.
What happens to units issued under existing Unit Trust of India schemes?
They are treated as units issued by the specified company or Administrator. Income distribution, redemption and purchase continue in the same manner as they would have under the Unit Trust of India.
