Section 20 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002
- (1)The Central Government may, by notification in the Official Gazette, make a Scheme for carrying out the provisions of this Act.
- (2)In particular, and without prejudice to the generality of the foregoing power, the said Scheme may provide for all or any of the following matters, namely:--
- (a)the manner in which the specified undertaking and schemes and assets and investments specified in Schedule I shall be managed;
- (b)the term of office of the Advisers, the fee and allowances and other conditions of appointment of the Advisers, disqualifications for being an Adviser, filling up of casual vacancy in the office of Adviser, the meetings of Board of Advisers, vacation and resignation of office of the Advisers;
- (c)the manner of payment of consideration for which the undertaking shall be transferred to the specified company;
- (d)the assets representing and relatable to the undertaking and the specified undertaking; and
- (e)such incidental, consequential and supplemental matters as may be necessary to carry out the provisions of this Act.
- (3)Every Scheme made under sub-section (1) shall be laid, as soon as may be after it is made before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions and if before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the Scheme or both Houses agree that the Scheme should not be made, the Scheme shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that Scheme.
Summary
- The Central Government can create a formal Scheme to put the rules of this Act into action.
- This Scheme is made public by being published in the Official Gazette.
- The Scheme can outline how specific investments and assets in Schedule I should be managed.
- It can set the rules for the Advisers, including their pay, term lengths, disqualifications, and how to fill empty seats on the Board of Advisers.
- The Scheme can explain how the payment for transferring the business to the new company will be handled.
- Just like schedule changes, the Scheme must be reviewed by both Houses of Parliament for thirty days, and Parliament can change or cancel it without ruining actions already taken.
Practical examples
FAQ
1. Where do the specific day-to-day rules for managing the investments come from?
The Central Government writes a detailed Scheme and publishes it in the Official Gazette to explain how the investments must be managed.
2. Can the Scheme decide when an Adviser gets fired or replaced?
Yes, the Scheme can include the rules for disqualifications, resignations, and filling empty seats on the Board of Advisers.
3. Who has the final say on the rules written in the Scheme?
Both Houses of Parliament review the Scheme for thirty days and have the power to agree to modifications or cancel it entirely.
Test yourself
Q1.Under Section 20 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, which of the following matters can be included in the Scheme made by the Central Government?
Q2.Under Section 20 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, how is the payment of consideration for transferring the undertaking to the specified company handled?
Q3.Under Section 20 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, what is the consequence if both Houses of Parliament agree that the Scheme should not be made?
Q4.Under Section 20 of The Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, what kind of matters can the Scheme cover regarding the assets of the business?