The Nagpur bench of the Bombay high court has dismissed a writ petition challenging the termination of Unit Trust of India's Rajlakshmi Unit Scheme 1992 (RUS-92).
The bench, comprising Justice J N Patel and Justice S G Gunderwar, yesterday observed that UTI's decision to terminate the scheme was not malafide.
While dismissing a writ petition filed by four beneficiaries of the scheme, the bench also noted that termination was in the interest of the investors.
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Earlier on Wednesday, the Bombay High Court had directed UTI to file an affidavit by October 9, 2000. UTI has clarified that the two-judge bench of the Bombay High Court had only asked it to file an affidavit by October 9, and that there was no stay per se in the court's Wednesday order as has been reported.
UTI officials said the offer document of the scheme clearly held that it could be terminated if the need arose. RUS-92 was launched in 1992 and offered an implicit return of 16.16 per cent to 16.75 per cent. The scheme has collected Rs 528 crore from 12 lakh investors.
UTI has decided to terminate the scheme with effect from October 1 and investors under the scheme will be paid a return of 16.16 to 16.75 per cent for the eight-year period. It has also given the investors a choice to reinvest into other UTI schemes, such as the Children's Career Plan.
UTI had suspended sales of the scheme a year after the launch as it had found that in the changing scenario the returns could not be sustained. Nearly 1.5 lakh investors have availed the conversion option offered by the fund.