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Securities Appellate Tribunal Decisions in March 2026: Case Law Digest

Read 15 LawLens analyses of Securities Appellate Tribunal decisions published in March 2026, covering key rulings, legal principles and case law.

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March 2026 Decisions

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### Professional Legal Summary: Kotak Mahindra Asset Management Co. Ltd. vs. SEBI Deficient service standards do not justify disgorgement of management fees absent evidence of wrongful gain. Key Legal Propositions: * Due Diligence Obligations: Asset Management Companies (AMCs) must conduct independent credit research on issuer entities as per Scheme Information Documents; reliance solely on promoter reputation or collateral value constitutes a lack of due care. * Maturity and Winding Up: Extending maturity dates of underlying securities beyond the scheme's maturity without unitholder consent violates Regulation 33(4) of MF Regulations and constitutes unauthorized partial redemption. * Timely Disclosure: A three-month delay in informing investors of significant adverse developments (e.g., security cover depletion) fails the "timely disclosure" mandate under Regulation 60. * Disgorgement vs. Penalty: Disgorgement is a restitutive remedy for "wrongful gain" or "averted loss" under Section 11B of the SEBI Act. It cannot be applied as a punitive measure for "abysmal standards of service" if unitholders suffered no actual monetary loss. Conclusion: The Tribunal upheld the findings of regulatory violations and the imposed penalties but set aside the direction to disgorge investment management fees, as deficient service—without established illegal enrichment—does not meet the statutory threshold for disgorgement.. Kotak Mahindra Asset Management Company Limited & Ors. v. Securities and Exchange Board of India (SEBI) Appeal No. 654 of 2021 and Appeal No. 527 of 2022. Securities Appellate Tribunal. LawLens

Securities Appellate Tribunal·

Banking and Finance LawAdministrative and Public Law

### Professional Legal Summary: Kotak Mahindra Asset Management Co. Ltd. vs. SEBI Deficient service standards do not justify disgorgement of management fees absent evidence of wrongful gain. Key Legal Propositions: * Due Diligence Obligations: Asset Management Companies (AMCs) must conduct independent credit research on issuer entities as per Scheme Information Documents; reliance solely on promoter reputation or collateral value constitutes a lack of due care. * Maturity and Winding Up: Extending maturity dates of underlying securities beyond the scheme's maturity without unitholder consent violates Regulation 33(4) of MF Regulations and constitutes unauthorized partial redemption. * Timely Disclosure: A three-month delay in informing investors of significant adverse developments (e.g., security cover depletion) fails the "timely disclosure" mandate under Regulation 60. * Disgorgement vs. Penalty: Disgorgement is a restitutive remedy for "wrongful gain" or "averted loss" under Section 11B of the SEBI Act. It cannot be applied as a punitive measure for "abysmal standards of service" if unitholders suffered no actual monetary loss. Conclusion: The Tribunal upheld the findings of regulatory violations and the imposed penalties but set aside the direction to disgorge investment management fees, as deficient service—without established illegal enrichment—does not meet the statutory threshold for disgorgement.

Kotak Mahindra Mutual Fund launched six close-ended Fixed Maturity Plans (FMPs) which held investments in Zero Coupon Non-Convertible Debentures (ZCNCDs) issued by Konti Infrapower and Edison Utility Works (promoter e...

3 MIN READ

### Professional Disclosures and Due Diligence Obligation for Mutual Fund Asset and Trustee Companies Legal Principle: Mutual funds must conduct independent credit due diligence regardless of collateral and ensure timely disclosure of adverse events affecting redemption. Core Ruling: Disgorgement of management fees is impermissible as a remedy for deficient service absent evidence of wrongful gain or averted loss.. Kotak Mahindra Asset Management Company Limited & Ors. v. Securities and Exchange Board of India (SEBI), Appeal No. 654 of 2021 and Appeal No. 527 of 2022.. Securities Appellate Tribunal. LawLens

Securities Appellate Tribunal·

Banking and Finance LawAdministrative and Public Law

### Professional Disclosures and Due Diligence Obligation for Mutual Fund Asset and Trustee Companies Legal Principle: Mutual funds must conduct independent credit due diligence regardless of collateral and ensure timely disclosure of adverse events affecting redemption. Core Ruling: Disgorgement of management fees is impermissible as a remedy for deficient service absent evidence of wrongful gain or averted loss.

Kotak Mahindra Mutual Fund launched six Fixed Maturity Plans (FMPs) between 2013 and 2017.

3 MIN READ