Section 15D:
Penalty for certain defaults in case of mutual funds.
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 penalty3[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.]]
Notes:
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).