The Supreme Court on Friday recognized the validity of e-voting on the closure of Franklin Templeton’s six mutual fund schemes, and said the disbursement of funds to unit holders would continue. A bench of Justices SA Nazir and Sanjeev Khanna dismissed the protest by some unit holders for the e-voting process, saying the disbursement of funds would continue as per the earlier order of the apex court. The apex court had on February 2 ordered that the unit holders of Franklin Templeton’s six mutual fund schemes be paid Rs 9,122 crore within three weeks. The court said that the disbursement of funds would be done in proportion to the shareholding in the assets of the unit holders.
Earlier, the apex court had asked the Securities and Exchange Board of India (SEBI) to appoint an observer to oversee the e-voting process.
Voting regarding the closure of Franklin Templeton’s six mutual fund schemes was held in the last week of December and was approved by most unit holders.
On 2 February, the Supreme Court had given a shocking blow to Franklin Templeton Mutual Fund to return Rs 9,122 crore within 20 days. In this entire process, the Supreme Court has appointed SBI Mutual Fund as a middleman. The Supreme Court, in its order, also said that if either party is not satisfied, they can knock the door of the Supreme Court.
What is the whole matter
Lockdown was imposed in the country due to Corona virus . This sudden decision had a bad effect on the market. In April 2020, Franklin Templeton closed 6 mutual fund schemes. For this, the company did not consult investors. After which the decision of the Karnataka High Court came against the company, the same decision was challenged in the Supreme Court.
The Supreme Court has asked the company to pay Rs 9,122 crore to its investors within 20 days. The Supreme Court had said on December 3 that the company should convene a meeting of the unit holders within a week and seek their consent. The Supreme Court commented on this, saying, “The matter is very big and people want their money back”
One of the most prominent mutual fund companies
Franklin Templeton Mutual Fund is one of India’s premier fixed income fund houses. During the lockdown in April, the company closed its 6 loan-giving schemes on the advice of investors. After which the dispute was greatly increased.