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An 87th minute equaliser ended the Kerala Blasters' developmental side's progress in the RFDL.
Mohun Bagan Super Giant took a 2-0 lead in the first half of their ISL match against Kerala Blasters in Kochi.
His current team, Mohun Bagan Super Giants, have conceded just one goal in six matches.
Mohun Bagan's matches in the competition are now null and void with the club 'considered to have withdrawn,' the AFC said in a statement.
Thaer Krouma scored a late equaliser as City came back from 0-2 to make it 2-2.
Anwar Ali, East Bengal and Delhi FC, are all jointly 'iable' for the compensation amount.
Kerala Blasters' latest signing Noah Sadaoui takes the Golden Boot.
The goalkeeper made doubles saves in tie-breaker as the defending champions won 4-3.
The loss also crushed Mohun Bagan's dream of becoming the first team to defend the ISL Cup and complete a rare double of winning the League Winners' Shield and the title.
The goal came just when the match was meandering towards extra-time as the 62,000-plus capacity crowd at the Salt Lake Stadium erupted in joy.
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