Penalty for default in case of stock brokers
Section 15F of the Securities and Exchange Board of India Act, 1992 deals with penalty for default in case of stock brokers. - If any person, who is registered as a stock broker under this Act,--- (a) fails to issue contract notes in the form and manner specified by the stock exchange of which such broker is a member, he shall be liable to [a penalty which shall not be less than one lakh rupees but which may extend to [on The Act came into force on 30 Jan 1992.
1[15F. Penalty for default in case of stock brokers---- If any person, who is registered as a stock broker under this Act,---
(a) fails to issue contract notes in the form and manner specified by the stock exchange of which such broker is a member, he shall be liable to 2[a penalty which shall not be less than one lakh rupees but which may extend to 3[one crore rupees]] for which the contract note was required to be issued by that broker;
(b) fails to deliver any security or fails to make payment of the amount due to the investor in the manner within the period specified in the regulations, he shall be liable to 4[a penalty
5[which shall not be less than one lakh rupees but which may extend to one lakh rupees for each day during which6[such failure continues] subject to a maximum of one crore rupees]];
(c) charges an amount of brokerage which is in excess of the brokerage specified in the regulations, he shall be liable to 7[a penalty 8[[which shall not be less than one lakh rupees but which may extend to five times the amount of brokerage]] charged in excess of the specified brokerage, whichever is higher.]
Section 15F, The Securities and Exchange Board of India Act, 1992 (Act 15 of 1992).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Magnum Equity Broking LTD vs Securities and Exchange Board of India
Court's Decision & Legal Precedent
The conditions stipulated in clauses (a), (b), and (c) of Section 15J of the SEBI Act, 1992 are illustrative in nature and not exhaustive. The Adjudicating Officer has discretion to consider circumstances beyond those enumerated in Section 15J while determining penalty quantum under Sections 15A to 15HA. Section 15J was never eclipsed by amendments to Sections 15A-15HA, and the Explanation added by Act No. 7 of 2017 clarified this legislative intent. The power to impose "such penalty as he thinks fit" under Section 15I(2) supports this discretionary approach. However, the imposition of penalty itself depends on satisfaction of substantive provisions in Sections 15A-15HA, not on satisfaction of Section 15J conditions.
On this section: Various penalty provisions for different securities violations (insider trading, fraudulent practices, Code of Conduct violations); all subject to Section 15J discretion for quantum determination.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Made under this section, and citing it
2 instruments name this provision in its title or its text without being made under it.
Questions about Section 15F
What have the courts held on Section 15F of the Securities and Exchange Board of India Act?
Magnum Equity Broking LTD vs Securities and Exchange Board of India (28 Feb 2019) is the leading judgment on this section among those set out below: Various penalty provisions for different securities violations (insider trading, fraudulent practices, Code of Conduct violations); all subject to Section 15J discretion for quantum determination.
How do I find court cases under Section 15F of the Securities and Exchange Board of India Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Sebi Act 15F, section 15F Sebi Act, section 15F of the Securities and Exchange Board of India Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Magnum Equity Broking LTD vs Securities and Exchange Board of India (28 Feb 2019).
What should I read with Section 15F of the Securities and Exchange Board of India Act, and has it changed?
3 other provisions in this corpus refer back to it. 2 instruments name it without being made under it, most recently SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 (1995), then the Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995. (1995).
When did Section 15F of the Securities and Exchange Board of India Act come into force?
Section 15F of the Securities and Exchange Board of India Act, cited as Sebi Act 15F, came into force on 30 Jan 1992, having been enacted on 04 Apr 1992. It is in force as at the date shown on this page.
Other sections of this Act
- 11. Functions of Board1315 words
- 11C. Investigation1145 words
- 12. Registration of stock-brokers, sub-brokers, share transfer agents, etc678 words
- 28A. Recovery of amounts629 words
- 15U. Procedure and powers of the Securities Appellate Tribunal494 words
- 15D. Penalty for certain defaults in case of mutual funds464 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 14 Oct 2026. This page is not a substitute for legal advice.