The Securities Appellate Tribunal (SAT) has reversed the penalty imposed by the Securities and Exchange Board of India (SEBI) on State Bank of India (SBI), Bank of Baroda and Life Information Corporation (LIC) on the matter of UTI Asset Management Company (AMC).
SEBI had fined the three entities for holding over 10% stake in UTI MF, which was in violation of SEBI rules.
A sponsor of a mutual fund, its associates or group company etc cannot have 10 per cent or more shareholding or voting rights in the AMC or Trustee Company of any other mutual fund or entities holding 10 per cent or more of such shareholding or voting rights, according to the Regulation 7B.
As per the order, these entities were given a time of one year i.e March 12, 2019 to comply with the regulation.
The appellants are in full compliance of regulation 7B with effect from October 12, 2020, said the SAT order.
It further said that given the facts and reasons, there is no justifiable reason to impose a monetary penalty in the present matter, a warning is sufficient.
"All 3 appeals are partly allowed by substituting the monetary penalty of Rs.10 lacs each imposed on the appellants with that of a warning. No order on costs," read the SAT order.
The present matter was heard through a video conference due to Covid-19 pandemic.