Kotak India Growth Fund Pays ₹10.87 Lakh To Settle SEBI Proceedings Over 5-Year Delay In Winding Up Scheme

Kotak India Growth Fund II has paid ₹10.87 lakh to settle proceedings that may be initiated by the Securities and Exchange Board of India (SEBI) over allegations that it delayed the winding up of a venture capital fund scheme and distribution of liquidation proceeds to investors by more than five years.

The settlement order was passed by SEBI Whole Time Members Kamlesh C. Varshney and K.V.R. Murty. 

Kotak India Growth Fund II, a SEBI-registered venture capital fund, filed a suo motu settlement application under the SEBI (Settlement Proceedings) Regulations, 2018, proposing to settle potential enforcement proceedings without admitting or denying the findings of fact and conclusions of law.

According to SEBI, the scheme commenced on March 27, 2008 with an initial tenure of nine years, extendable by up to 36 months. While the tenure ultimately ended on March 27, 2020, the winding up of the scheme and distribution of liquidation proceeds to investors were completed only on October 16, 2025, resulting in a delay of over five years.

Pursuant to discussions with SEBI's Internal Committee and consideration by the High Powered Advisory Committee, the fund offered ₹10.87 lakh as the settlement amount. The proposal was approved by SEBI's Panel of Whole Time Members, and SEBI confirmed receipt of the amount.

Accordingly, SEBI ordered that any proceedings in relation to the alleged violations stand settled and that no enforcement action shall be initiated against the fund in respect of those violations.

However, SEBI reserved its right to initiate appropriate action if any representation made by the fund in the settlement proceedings is subsequently found to be untrue, if the fund breaches any of the conditions or undertakings given during the settlement process, or if any shortfall in the settlement amount is discovered.