The Delhi High Court has issued notice to the trustee and asset management company of Franklin Templeton and market regulator Sebi. The US parent of Franklin Templeton and government of India have also been added as a party to the matter.
Mumbai: One more investor has moved Delhi High Court against Franklin Templeton Mutual Fund challenging the whole process of winding up of six debt schemes and seeking a refund of money. This is the third case to be filed against Franklin by investors in a court.
The petitioner Amruta Garg has also challenged the consequent notice issued by the fund house for e-voting.
The Delhi High Court has issued notice to the trustee and asset management company of Franklin Templeton and market regulator Sebi. The US parent of Franklin Templeton and government of India have also been added as a party to the matter.
The petitioner has stated that the contention of Franklin Templeton citing present coronavirus pandemic for the schemes to be wound up and that this is the only viable option to preserve value for unit holders is a hogwash, said a lawyer familiar with the matter.
“The trustees have failed to make prudent investments and faulted in proper administration of the fund. Franklin Templeton has been falling short in following the circulars of Sebi, which were for increasing transparent of investment, time and again. Also, the fund invested in securities which were of low credit rating,” the petition says .
The court has also directed Sebi to ensure compliance of its regulations and take action if it finds any substance in the forensic audit which is underway.
“All decisions on winding up of the scheme would be subject to the outcome of the writ petition,” the lawyer quoted above said.
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The Petition was filed by Abhinav Shrivastava, Partner GSL Chambers and Ravindra Shrivastava, Senior Advocate argued the case on behalf of investor. Tushar Mehta, Solicitor General, appeared for SEBI, while Franklin Templeton was represented by C.A. Sundaram.
Last week, one of the promoters of instant drink maker Rasna along with other investors moved the Gujarat High Court. Before that, a public interest litigation was filed by Chennai Financial Markets Accountability (CFMA), an investors association before the Madras High Court.
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