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Can PMS charge Exit load on the transmission of units/ investments to Nominee after the death of Investor which happens within a period of 2 years from the date of investment in PMS (Port Folio Management Scheme)? Further, the PMS has also levied management fees for two continuing quarters and still, transmission has not been completed.

—Name withheld on request

Based on the limited facts conveyed in your query, the exit loads are permissible on the redemption of units or investments. In my view, transmission could be viewed differently than redemption, as in the case of transmission it is the transfer of units or investments, which is initiated due to a natural event. However, it is subjective and depends on the PMS provider and the service agreement, if they want to waive the exit load.

On the management fees charged during the transmission, if the investments continue to be managed by the PMS provider during the process then the management fees will be applicable. Unless the provider agreement has mentioned any waiver of management fees during the transmission, which is quite unlikely.

You may also note that if you decide to liquidate or redeem your PMS after the completion of the transmission process within the exit load period, you will be charged with applicable exit loads based on the PMS agreement.

Answered by Harshad Chetanwala, founder Have personal finance queries? Send an email to

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