MUTUAL FUNDS DEPARTMENT

Chairman SEBI has passed orders under Section 11 B of the SEBI Act, 1992 directing Indian Bank Mutual Fund to pay returns to the unitholders as committed in the offer documents of their Indprakash and Ind Jyothi schemes. 
 
Indprakash scheme was due for redemption on November 30, 1999. Directions have been issued to pay dividends from 1996-97 onwards till redemption. 
 
Ind Jyothi scheme was redeemed in March, 1998. Mutual Fund has been directed to pay the assured dividends for the year 1996-97 to the unitholders who stayed with the scheme for the entire year 1996-97 and got their units repurchased during 1997-98. 
 
SEBI has further directed that if the Indian Bank Mutual Fund is not in a position to pay the aforesaid returns to the unitholders, the shortfall shall be borne by the Indian Bank, being the sponsor and principal trustee of the mutual fund. The bank shall submit its proposal of funding to Mutual Fund to the extent of shortfall to SEBI within a period of 30 days from the date of this Order. Meanwhile, the redemption proceeds shall be made to the investors of Indprakash scheme within 10 working days after 30/11/99 at NAV related price. 
 
Failure to comply with these directions shall render the Indian Bank Mutual Fund and the sponsor and principal trustee i.e. the Indian Bank liable to be proceeded against under the provisions of SEBI Act, 1992 and the Regulations made thereunder.