Union Budget 2023-24 + FINANCE Bill, 2023

Extension of exemption to Specified Undertaking of Unit Trust of India (SUUTI) and providing for alternative mechanism for vacation of office of the Administrator.

SUUTI was created by the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 [ UTI Repeal Act, 2002]. It is the successor of the erstwhile Unit Trust of India (UTI) and is mandated to liquidate the Government liabilities on account of erstwhile UTI.

2. As per sub-section (1) of section 13 of the UTI Repeal Act, 2002, SUUTI has been exempted from payment of income-tax up to 31.03.2023. Further, sub-section (1) of section 8 of the UTI Repeal Act, 2002 provides that the Administrator, SUUTI shall vacate its office only on the redemption of all the schemes.

3. It has been represented that SUUTI has been continuously working for payment of investors’ dues through redemption of various schemes since its formation. However, at the current pace, the redemption of all the schemes and payment of entire amount to remaining investors may take indefinite time. Further, the work of SUUTI pertaining to the redemption of schemes, payments of entire amounts, pending litigation etc. is expected to extend beyond 31.03.2023, i.e., beyond the time limit till which the income-tax exemption has been provided.

4. In view of the above, it is proposed amend the UTI Repeal Act, 2002, by way of amendment of ,-

(i) Sub-section (1) of section 8, so as to provide that the Administrator, SUUTI shall immediately on redemption of all the schemes of the specified undertaking and the payment of entire amount to investors or from the date as may be notified by the Central Government in the Official Gazette, whichever is earlier, vacate his office;

(ii) Sub –section (1) of section 13, so as to provide that notwithstanding anything contained in the Income-tax Act, 1961 (43 of 1961) or any other enactment for the time being in force relating to tax or income, profits or gains, no income-tax or any other tax shall be payable by the Administrator in relation to the specified undertaking till the period ending on the 30th day of September, 2023 in respect of any income, profits or gains derived, or any amount received in relation to the specified undertaking.

5. This amendment will take effect from 1st April, 2023.

[Clause 154]

 

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Full Text:

Union Budget 2023-24 + FINANCE Bill, 2023

Tax exemption extension for SUUTI permits continued tax-free administration until a notified date, with revised vacation rules. Proposal amends the UTI Repeal Act, 2002 to extend that no income-tax or other tax shall be payable by the Administrator in relation to the specified undertaking until the period ending on the thirtieth day of September, 2023, and to provide that the Administrator shall vacate office immediately on redemption of all schemes and payment of entire amounts to investors or from a date notified by the Central Government, whichever is earlier.