CS Executive · Capital Market and Securities Laws · Mutual Funds
Kaveri Mutual Fund is registered with SEBI but fails to make an application for listing of its schemes as provided in the listing regulations, and the failure continues for many days. Under Section 15D of the SEBI Act, 1992, what is the maximum total penalty?
The maximum is one crore rupees. Under Section 15D(c), a registered mutual fund failing to apply for listing of its schemes pays a per-day penalty for each day the failure continues, but the total is capped at one crore rupees.
- AOne crore rupeesCorrect
- BTen lakh rupees
- COne lakh rupees
- DThere is no maximum; the per-day penalty continues indefinitely
Explanation
Section 15D(c) penalises failure to apply for listing with a per-day penalty for each day the failure continues, subject to a maximum of one crore rupees. Ten lakh rupees was part of the old 'whichever is higher' formula, and one lakh rupees is the per-day figure, not the cap.
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