RBI imposes monetary penalty on Asset Care & Reconstruction Enterprise Limited
The Reserve Bank of India (RBI) has, by an order dated September 08, 2026, imposed a monetary penalty of ₹27.30 lakh (Rupees Twenty Seven Lakh Thirty Thousand only) on Asset Care & Reconstruction Enterprise Limited (the company) for non-compliance with certain provisions of the directions issued by RBI on ‘Income Recognition’. This penalty has been imposed in exercise of powers conferred on RBI…
On September 08, 2026, the Reserve Bank of India (RBI) imposed a monetary penalty of ₹27.30 lakh on Asset Care & Reconstruction Enterprise Limited for failing to comply with regulatory directives on income recognition. The penalty was issued by the RBI, exercising its authority under sections 12 and 30A(1) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.
A statutory inspection of the company's financial position, conducted as of March 31, 2025, revealed non-compliance with the RBI's directions. Following this, the RBI issued a notice to the company, requesting an explanation for its failure to adhere to the rules. The company was given an opportunity to present additional submissions and make oral arguments during a personal hearing.
Upon reviewing the company's response, additional submissions, and oral arguments, the RBI concluded that the company had breached regulatory requirements related to the charging of management fees. This penalty is a result of deficiencies in regulatory compliance and is not aimed at judging the validity of any transactions or agreements between the company and its customers. The imposition of this monetary fine does not preclude the RBI from taking further action against the company, should it deem it necessary.
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