- HDFC Property Fund and HDFC Capital Advisors settled a case with Sebi by paying Rs 26 lakh
- The case involved delays in asset liquidation and distribution under venture fund regulations
- HIREF scheme's liquidation was completed seven years after the extended tenure ended in 2014
HDFC Property Fund and HDFC Capital Advisors have settled a case concerning a violation of venture fund regulation with markets regulator Sebi after paying Rs 26 lakh.
The case pertains to the alleged delay in completing the process of asset liquidation and distribution of proceeds.
In other words, there was a delay in winding up the schemes which is non-compliant with Sebi's Venture Capital Funds rules.
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According to a settlement order issued by Sebi on Thursday, HDFC Property Fund and HDFC Capital Advisors filed suo motu settlement applications with the regulator proposing to settle by "neither admitting nor denying the findings of facts and conclusions of law".
HDFC Property Fund had launched two schemes -- HDFC India Real Estate Fund (HIREF) and HDFC IT Corridor Fund (HITCF).
Both schemes were constituted for seven years with a provision for extension by two one-year periods. HIREF was constituted from July 18, 2005 while HITCF was launched on July 29, 2005.
In the case of HIREF, Sebi noted the end date of the extended tenure was June 17, 2014. However, it was noted that the fund completed the process of liquidation of assets and distribution of proceeds on March 31, 2021 -- with a delay of about seven years.
Further, the fund had retained Rs 5.33 crore for contingent liabilities, which the fund distributed to its investors on March 25, 2025.
Similarly, for HITCF, the end date of the extended tenure was June 28, 2014. It was noted that the fund completed the process of liquidation of assets and distribution of proceeds on March 28, 2014.
However, the fund retained a residual amount of Rs 0.89 crore for contingent liabilities, which it distributed to investors on March 25, 2025.
Following discussions with the regulator's committees, HDFC Property Fund and HDFC Capital Advisors agreed to pay Rs 26 lakh as settlement amount.
"It is hereby ordered that any proceedings that may be initiated for the violations... are settled in respect of the applicants," Sebi said.
Sebi noted that HDFC Capital Advisors assumed the role of the investment manager for HDFC Property Fund, effective May 2, 2023, due to internal restructuring within the HDFC group, which was a prerequisite for the merger of the erstwhile HDFC with and into HDFC Bank.
HDFC Capital Advisors distributed the entire retained amounts (which the erstwhile investment manager had retained) to the fund's investors in March 2025 to achieve a 'nil' balance in bank accounts of both schemes.
Sebi clarified that HDFC Capital Advisors had no role in operations and decision making regarding schemes for which the present settlement applications were filed.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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