Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
Any guarantee given for or in favour of the Trust with respect to any loan, lease, finance or other assistance shall continue to be operative in relation to the specified undertaking managed by the Administrator.
Summary
- Any existing guarantees made to or for the old Trust remain valid.
- These guarantees could be for loans, leases, finance, or other forms of assistance.
- The Administrator, who now manages the specified undertaking, can still rely on and enforce these guarantees just like the old Trust could.
Practical examples
FAQ
1. If someone guaranteed a loan for the old Trust, do they have to write a new guarantee for the Administrator?
No, the existing guarantee automatically continues to work for the specified undertaking managed by the Administrator.
2. What types of agreements are covered by this rule?
It covers any guarantee regarding a loan, lease, finance, or other assistance.
3. Can a guarantor walk away because the old Trust is gone?
No, the law ensures the guarantee remains completely operative despite the change in management.
Test yourself
Q1.Under Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, what happens to guarantees given for the Trust regarding loans or leases?
Q2.Under Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, who manages the specified undertaking that benefits from these continuing guarantees?
Q3.Under Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, which of the following is explicitly listed as a type of assistance covered by continuing guarantees?
Q4.Under Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, a guarantee given in whose favour continues to be operative?
Q5.Under Section 15 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, does this section mention guarantees related to stock market dividends?