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nism-series-va-equity-debt-fund-purchase-cut-off-timing[ MUTUAL FUND DISTRIBUTORS ]

Under SEBI's uniform fund realization rule, what is the Cut-Off Time for purchase applications in open-ended Equity and Debt schemes (other than Liquid/Overnight) to receive that business day's closing NAV?

[ A ]3:00 PM on a business day, provided funds are credited and realized in the AMC's bank account before 3:00 PM.[ CORRECT ]
[ B ]1:30 PM on a business day.
[ C ]11:00 AM on a business day.
[ D ]3:30 PM upon stock exchange closing.
Takeaway

Option A is correct: 3:00 PM on a business day, provided funds are credited and realized in the AMC's bank account before 3:00 PM.

Derivation
SEBI's uniform fund realization rule requires that for open-ended Equity, Hybrid, and Debt schemes other than Liquid and Overnight funds, the applicable NAV is the closing NAV of the business day on which the application is time-stamped AND the funds are credited and available for utilization in the AMC's bank account before 3:00 PM. Both conditions must be satisfied together — an application submitted at 2:55 PM backed by funds that clear the bank only at 3:05 PM would miss the cut-off and roll to the next business day's NAV. This 3:00 PM threshold is distinct from the 1:30 PM cut-off governing Liquid and Overnight schemes, and from the 3:30 PM exchange closing time, which has no bearing on mutual fund NAV allotment.
Why the others fail
B — 1:30 PM on a business day.
1:30 PM is the statutory cut-off specifically for Liquid and Overnight schemes; ordinary Equity, Hybrid, and Debt schemes use a later 3:00 PM cut-off instead.
C — 11:00 AM on a business day.
11:00 AM was a temporary pandemic-era cut-off applied during the COVID-19 lockdown; the standard cut-off for these schemes has since reverted to 3:00 PM.
D — 3:30 PM upon stock exchange closing.
3:30 PM marks the close of stock exchange trading, a separate event from the 3:00 PM cut-off SEBI prescribes for mutual fund subscription NAV allotment.