SC asks Franklin investors to approach Sebi before approaching it

MUMBAI: The Supreme Court has dismissed a plea filed by seven Delhi-based investors, who had challenged the Franklin Templeton Mutual Fund’s move to scrap six debt schemes. The apex court asked these investors to seek the intervention of Securities & Exchange Board of India (Sebi) and other judicial bodies first before approaching it leading to investors withdrawing the case.

On Friday, the division bench of Justice Arun Mishra, Justice Abdul Nazeer and Justice Indira Banerjee, while disposing of the plea filed by seven investors including Sanyam Jain, Sarika Mittal, Aakansha Maheshwari and Priya Meghnani, observed that the investors have other forums available to them at this point in time.

Investors had alleged that Franklin decided to unwind the six debt schemes without seeking unitholders’ approval.


C Aryma Sundaram, senior counsel, who is representing the fund house in the case, confirmed the development.

“With reference to the status of the writ petition filed before the Hon’ble Supreme Court against Union of India, SEBI, Franklin Templeton etc., we wish to confirm that the matter was dismissed as withdrawn when it was taken up by the court today,” said a spokesperson for Franklin Templeton.

The Gujarat High Court on Wednesday put Franklin Templeton Mutual Fund’s electronic voting process for winding up of the debt schemes on hold following a petition that the asset manager’s trustees did not seek unitholders’ consent before scrapping them. Investors have also filed cases against the fund house in other cities like Chennai and Delhi.

After this decision, the e-voting which was scheduled to happen on Jun 9-11 has been suspended.

“Apropos the interim stay order on the unitholders meeting issued by the Hon’ble Gujarat High Court, Franklin Templeton has filed an appeal before the Hon’ble Supreme Court and the matter is sub judice,” said the Franklin spokesperson.