Unit Trust of India (UTI) Repeal Act, 2002 established the Specified Undertaking of Unit Trust of India (SUUTI), which is tasked with liquidating the government liabilities of the former UTI. SUUTI has been exempt from paying income tax up to March 31, 2023, with the Finance Act, 2023 extending this exemption until March 31, 2025. However, due to pending tasks such as scheme redemptions and litigation, it is anticipated that SUUTI’s work will continue beyond the current exemption deadline. As a result, the Finance Bill 2025 proposes to extend the tax exemption period to March 31, 2027. This change, which will take effect from April 1, 2025, ensures that SUUTI will not be required to pay income tax or any other tax during this extended period.
Budget 2025: Extension of exemption to Specified Undertaking of Unit Trust of India (SUUTI)
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 31st day of March, 2023. Finance Act, 2023 amended the UTI Repeal Act, 2002, to extend such date to 31st day of March, 2025.
3. It has been represented that the work of SUUTI pertaining to the redemption of schemes, payments of entire amounts, pending litigation etc. is expected to extend beyond 31st day of March, 2025, i.e., beyond the time limit till which the income-tax exemption has been provided..
4. In view of the above, it is proposed to amend the UTI Repeal Act, 2002, by way of amendment of 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 on income, profits or gains, no income-tax or any other tax shall be payable by the Administrator in relation to the specified undertaking for the period beginning on the appointed day and ending on the 31st day of March, 2027 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 the 1st day of April, 2025.
[Clause 131]
Extract of Relevant Clauses of Finance Bill, 2025
Clause 131 of the Bill seeks to amend section 13 of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 relating to tax exemption or benefit to continue to have effect.
The said section, inter alia, provides for the period for which the tax shall be payable by the Administrator of a specified undertaking.
It is proposed to amend sub-section (1) of the said section so as to extend the period from 31st March, 2025 to 31st March, 2027.
This amendment will take effect from 1st April, 2025.
Extract of Relevant Amendment Proposed by Finance Bill, 2025
131. Amendment of Act 58 of 2002.
In the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, in section 13, in sub-section (1), for the figures “2025”, the figures “2027” shall be substituted.
PART II
AMENDMENTS TO THE GOVERNMENT SECURITIES ACT, 2006
WHEREAS it is expedient to amend the law relating to Government securities and its management by the Reserve Bank of India;
AND WHEREAS the subject matter of “Public debt of the State” falls within the ambit of State List of the Seventh Schedule to the Constitution;
AND WHEREAS in pursuance of clause (1) of article 252 of the Constitution, resolutions have been passed by the Houses of the Legislatures of the States of Andhra Pradesh, Chhattisgarh, Haryana, Nagaland, Punjab, Uttarakhand, Uttar Pradesh and West Bengal that the subject matter aforesaid should be regulated in those States by Parliament by law.
