Bombay HC two-judge bench recuse themselves from PIL agianst SEBI, AMFI

Chief Justice and Justice Dangre recused themselves from hearing a PIL against SEBI and AMFI regarding mutual funds ads.

Chief Justice and Justice Dangre, who were hearing the Public Interest Litigation (PIL) against Securities and Exchange Board of India (SEBI) and the Association of Mutual Funds in India (AMFI) regarding mutual funds advertisements, recused themselves from the matter in the hearing on January 30.

The two-judge bench didn’t mention any reason behind the recusal. The litigation was filed by a Mumbai-based Chartered Accountant Chandrakant C Shah seeking to “revoke the liberty granted to Association of Mutual Funds in India (AMFI) for investor education and awareness [due to its blatant misuse], and further issue directions to AMFI to immediately desist from further relaying its false, deceptive and misleading ad campaigns, as the same are seriously prejudicial to the interest of public and investors at large” according to the petition.

According to the PIL, the “mutual funds sahi hai” campaign and other similar advertisements “were entirely designed to benefit its member organisations, with no concern whatsoever, about the safety and well-being of investors and public,” in the garb of investor awareness. He further alleged that industry body AMFI, and further the SEBI had failed to protect investor interest in what he calls a “reckless” ad campaign. 

The petition assumes significance as India continues to have robust mutual fund inflows from domestic investor, even as continued sake from foreign investors and a volatile stock market. December 2024 was the 46th consecutive month of mutual fund inflows, according to a research note by Morningstar Investment Research. More than 10.16 crore people invested money in mutual funds as of the last month of 2024, according to the note.