Regulation 35 - Allotment of units and refunds of money - Securities and Exchange Board of India (Mutual Funds) Regulations, 1996

Allotment of units and refunds of money 35. (1) The asset management company shall specify in the offer document,- (a) the minimum subscription amount it seeks to raise under the scheme; and (b) in case of over subscription the extent of subscription it may retain : Provided that where the asset management company retains the over subscription referred to in clause (b), all the applicants applying upto five thousand units shall be given full allotment subject to the over subscription mentioned in clause (b). (2) The mutual fund and asset management company shall be liable to refund the application money to the applicants,- (i) if the mutual fund fails to receive the minimum subscription amount referred to in clause (a) of sub-regulation (1); (ii) if the moneys received from the applicants for units are in excess of subscription as referred to in clause (b) of sub-regulation (1). 5 [ (3) Any amount to be refunded to the applicants under sub-regulation (2) shall be refunded within a period of five working days from the date of closure of subscription list and in the manner as may be specified by the Board from time to time ] (4) In the event of failure to refund the amounts within the period specified in sub-regulation (3), the asset management company shall be liable to pay interest to the applicants at a rate of fifteen per cent per annum from the expiry of 3 [five working days] from the date of closure of the subscription list: 6 [ **** ] ************* NOTES:- 1 Substituted for six weeks ibid. 2 Inserted by the SEBI (Mutual Funds) (Second Amendment) Regulations, 2013 w.e.f. 19-6-2013 3 Substituted for six weeks , ibid. 4 Inserted by the SEBI (Mutual Funds) (Second Amendment) Regulations, 2013 w.e.f. 19-6-2013 5. Substituted vide Notification No. SEBI/LAD-NRO/GN/2021/08 dated 04-02-2021 w.e.f. 30th day from the date of their publication in the Official Gazette, that is 04-02-2021 before it was read as, (3) Any amount refundable under sub-regulation (2) shall be refunded within a period of 1 [five working days] from the date of closure of subscription list, by Registered post with acknowledgement due and by cheque or demand draft marked A/c payee to the applicants: 2 [Provided that in case of mutual fund schemes eligible under Rajiv Gandhi Equity Savings Scheme, the period specified in this sub-regulation shall be fifteen days from the closure of the initial subscription list.] 6. Omitted vide Notification No. SEBI/LAD-NRO/GN/2021/08 dated 04-02-2021 w.e.f. 30th day from the date of their publication in the Official Gazette, that is 04-02-2021 before it was read as 4 [Provided that in case of mutual fund schemes eligible under Rajiv Gandhi Equity Savings Scheme, the period specified in this sub-regulation shall be fifteen days from the closure of the initial subscription list.]