Section 15D in The Securities and Exchange Board of India Act, 1992

Title: Penalty for certain defaults in case of mutual funds

Description: 1[15D. Penalty for certain defaults in case of mutual funds---- If any person, who is--- (a) required under this Act or any rules or regulations made thereunder to obtain a certificate of registration from the Board for sponsoring or carrying on any collective investment scheme, including mutual funds, sponsors or carries on any collective investment scheme, including mutual funds, without obtaining such certificate of registration, he shall be liable to 2[a penalty 3[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which he sponsors or carries on any such collective investment scheme including mutual funds subject to a maximum of one crore rupees;]] (b) registered with the Board as a collective investment scheme, including mutual funds, for sponsoring or carrying on any investment scheme, fails to comply with the terms and conditions of certificate of registration, he shall be liable to 4[a penalty 5[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees;]] (c) registered with the Board as a collective investment scheme including mutual funds, fails to make an application for listing of its schemes as provided for in the regulations governing such listing, he shall be liable to 6[a penalty 4[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees;]] (d) registered as a collective investment scheme, including mutual funds, fails to despatch unit certificates of any scheme in the manner provided in the regulation governing such despatch, he shall be liable to 6[a penalty 4[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees;]] (e) registered as collective investment scheme, including mutual funds, fails to refund the application monies paid by the investors within the period specified in the regulations, he shall be liable to 8[a penalty 4[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees;]] (f) registered as a collective investment scheme, including mutual funds, fails to invest money collected by such collective investment schemes in the manner or within the period specified in the regulations, he shall be liable to 9[a penalty 4[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees.]] 1. Ins. by Act 9 of 1995, s. 9 (w.e.f. 25-1-1995). Br 2. Subs. by Act 59 of 2002, s. 12, for "a penalty not exceeding ten thousand rupees for each day during which he carries on any such collective investment scheme including mutual funds, or ten lakh rupees, whichever is higher" (w.e.f. 29-10-2002). 3. Subs. by Act 27 of 2014, s. 9, for certain words (w.e.f. 8-9-2014). 4. Subs. by Act 59 of 2002, s. 12, for "a penalty not exceeding ten thousand rupees for each day during which such failure continues or ten lakh rupees, whichever is higher" (w.e.f. 29-10-2002). 5. Subs. by Act 27 of 2014, s. 9, for certain words (w.e.f.8-9-2014). 6. Subs. by s. 12, ibid., for "a penalty not exceeding five thousand rupees for each day during which such failure continues" (w.e.f. 29-10-2002). 7. Subs. by Act 27 of 2014, s. 9, for certain words (w.e.f.8-9-2014). 8. Subs. by Act 59 of 2002, s. 12, for a penalty not exceeding five thousand rupees for each day during which such failure Continues (w.e.f. 29-10-2002). 9. Subs. by s. 12, ibid., for a penalty not exceeding one thousand rupees for each day during which such failure continue (w.e.f. 29-10-2002).

Title: Penalty for failure to observe rules and regulations by an asset management company

Description: 1[15E. Penalty for failure to observe rules and regulations by an asset management company.-- Where any asset management company of a mutual fund registered under this Act fails to comply with any of the regulations providing for restrictions on the activities of the asset management companies, such asset management company shall be liable to 2[a penalty 3[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees.]]] 1. Ins. by Act 9 of 1995, s. 9 (w.e.f. 25-1-1995). Br 2. Subs. by s. 13, ibid., for "a penalty not exceeding five lakh rupees for each such failure" (w.e.f. 29-10-2002). 3. Subs. by Act 27 of 2014, s. 10, for certain words (w.e.f.8-9-2014

Title: Penalty for default in case of alternative investment funds, infrastructure investment trusts and real estate investment trusts

Description: 1[15EA. Penalty for default in case of alternative investment funds, infrastructure investment trusts and real estate investment trusts.-- Where any person fails to comply with the regulations made by the Board in respect of alternative investment funds, infrastructure investment trusts and real estate investment trusts or fails to comply with the directions issued by the Board, such person shall be liable to penalty which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees or three times the amount of gains made out of such failure, whichever is higher.] 1. Ins. by Act 13 of 2018, s. 182 (w.e.f. 8-3-2019).

Title: Penalty for default in case of investment adviser and research analyst

Description: 1[2[15EB. Penalty for default in case of investment adviser and research analyst.--Where an investment adviser or a research analyst fails to comply with the regulations made by the Board or directions issued by the Board, such investment adviser or research analyst shall be liable to penalty which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which such failure continues subject to a maximum of one crore rupees.]] 1. Ins. by Act 9 of 1995, s. 9 (w.e.f. 25-1-1995). Br 2. Ins. by Act 13 of 2018, s. 182 (w.e.f. 8-3-2019).

Title: Penalty for default in case of stock brokers

Description: 1[15F. Penalty for default in case of stock brokers---- If any person, who is registered as a stock broker under this Act,--- (a) fails to issue contract notes in the form and manner specified by the stock exchange of which such broker is a member, he shall be liable to 2[a penalty which shall not be less than one lakh rupees but which may extend to 3[one crore rupees]] for which the contract note was required to be issued by that broker; (b) fails to deliver any security or fails to make payment of the amount due to the investor in the manner within the period specified in the regulations, he shall be liable to 4[a penalty 5[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which 6[such failure continues] subject to a maximum of one crore rupees]]; (c) charges an amount of brokerage which is in excess of the brokerage specified in the regulations, he shall be liable to 7[a penalty 8[[which shall not be less than one lakh rupees but which may extend to five times the amount of brokerage]] charged in excess of the specified brokerage, whichever is higher.] 1. Ins. by Act 9 of 1995, s. 9 (w.e.f. 25-1-1995). Br 2. Subs. by Act 27 of 2014, s. 11, for "a penalty not exceeding five times the amount" (w.e.f.8-9-2014). 3. Ins. by Act 23 of 2019, s. 184 (w.e.f. 20-1-2020). 4. Subs. by Act 59 of 2002, s. 14, for "a penalty not exceeding five thousand rupees for each day during which such failure continues" (w.e.f. 29-10-2002). 5. Subs. by Act 27 of 2014, s. 11, for certain words (w.e.f.8-9-2014). 6. Subs. by Act 13 of 2018, s. 183, for "he sponsors or carries on any such collective investment scheme including mutual fund" (w.e.f. 8-3-2019).. 7. Subs. by Act 59 of 2002, s. 14, for "a penalty not exceeding five thousand rupees" (w.e.f. 29-10-2002). 8. Subs. by Act 27 of 2014, s. 11, for "of one lakh rupees or five times the amount of brokerage" (w.e.f.8-9-2014).

CHAPTER 6A PENALTIES AND ADJUDICATION