Special Undertaking of Unit Trust of India
The Cabinet is also expected to take a call on creation of a holding company to transfer underlying assets of the Special Undertaking of Unit Trust of India (SUUTI). This proposal has drawn a lot of opposition from public sector banks. The proposed company is likely to discharge claim and liabilities arising out of or relating to the scheme referred to in UTI Repeal Act 2002 and relatable to SUUTI, the source added. SUUTI was formed by the restructuring of the erstwhile Unit Trust of India (UTI) into UTI Trustee Company Private Ltd and the SUUTI. It came into effect from February 1, 2003. This has been entrusted with the responsibility of managing various schemes managed by erstwhile UTI. The proposed company may be in the form of a special purpose vehicle to be funded by banks. It could be asked to buy Government's stake in Axis Bank, L&T and ITC which is being held through SUUTI. However, the holding company will not be allowed to pledge these shares but can borrow funds on the basis of these shares. These shares cannot be sold without the permission of the lenders and the Government.