Section 26: Appointment of custodian

Q: What does Section 26 of The SEBI (Mutual Funds) Regulations, 1996 (TSMFR) deal with?

Section 26 TSMFR pertains to "Appointment of custodian". It is part of the The SEBI (Mutual Funds) Regulations, 1996, a legislation enacted by the Parliament of India. Section 26 of The SEBI (Mutual Funds) Regulations, 1996 (TSMFR) governs appointment of custodian. As verified on 19 May 2026.

Q: Is Section 26 TSMFR still in force?

Yes, Section 26 of the The SEBI (Mutual Funds) Regulations, 1996 is currently in force across the Republic of India.

Q: What is धारा 26 TSMFR?

धारा 26 TSMFR is the Devanagari Hindi reference for Section 26 of the The SEBI (Mutual Funds) Regulations, 1996. Section 26 of The SEBI (Mutual Funds) Regulations, 1996 (TSMFR) governs appointment of custodian. As verified on 19 May 2026.

Q: What is Dhara 26 TSMFR?

Dhara 26 TSMFR is the Roman Hindi reference for Section 26 of the The SEBI (Mutual Funds) Regulations, 1996. "Dhara" means "Section" in Hindi. Section 26 of The SEBI (Mutual Funds) Regulations, 1996 (TSMFR) governs appointment of custodian. As verified on 19 May 2026.

Q: How to cite Section 26 of The SEBI (Mutual Funds) Regulations, 1996?

Cite as: "Section 26, The SEBI (Mutual Funds) Regulations, 1996 (TSMFR)" in legal briefs. For academic writing, use the BlueBook format: The SEBI (Mutual Funds) Regulations, 1996, § 26 (India).

Law on Tips Editorial Board

(1)

The mutual fund shall appoint a Custodian to carry out the custodial services for the schemes of the fund and sent intimation of the same to the Board within fifteen days of the appointment of the Custodian:

[Provided that in case of a gold exchange traded fund scheme, the assets of the scheme being gold or gold related instruments may be kept in the custody of a custodian registered with the Board]. [Substituted by Notification No. SEBI/LAD/NRO/GN/2020/07, dated 06.3.2020.]

[Provided further that in case of a real estate mutual fund scheme, the title deed of real estate assets held by it may be kept in the custody of a custodian registered with the Board.] [Inserted by Not. F No. LAD-NRO/GN/2008/03/123042, dated 16.4.2008.]

[Provided also that mutual fund schemes investing in exchange traded commodity derivatives may appoint a custodian to have custody of the underlying goods in case of physical settlement of such contracts.] [Inserted by Notification No. SEBI/LAD-NRO/GN/2019/011, dated 26.4.2019.]

(2)

No custodian in which the sponsor or its associates hold 50 per cent or more of the voting rights of the share capital of the custodian or where 50 per cent or more of the directors of the custodian represent the interest of the sponsor or its associates shall act as custodian for a mutual fund constituted by the same sponsor or any of its associates or subsidiary company.

[Provided that where the sponsor or its associates hold 50 per cent or more of the voting rights of the share capital of the custodian, such custodian may act as custodian for a mutual fund constituted by the same sponsor or any of its associates or subsidiary company if:

(i) the sponsor has a net worth of at least twenty thousand crore rupees at all points of time;

(ii) 50 per cent or more of the directors of the custodian are those who do not represent the interest of the sponsor or its associates;

(iii) the custodian and the asset management company of a mutual fund are not subsidiaries of each other;

(iv) no person is a director of both the custodian and the asset management company of a mutual fund; and

(v) the custodian and the asset management company of a mutual fund sign an undertaking that they will act independently of each other in their dealings with the scheme.]