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SEBI appoints ex-CEC as observer for e-voting on Franklin Templeton schemes

Taruvai Subayya Krishnamurthy has served as the 13th Chief Election Commissioner of India from February 2004 to May 2005. During his tenure, he oversaw 2004 Lok Sabha elections

twitter-logoBusinessToday.In | December 26, 2020 | Updated 18:57 IST
SEBI appoints ex-CEC as observer for e-voting on Franklin Templeton schemes

Securities and Exchange Board of India (SEBI) has appointed Taruvai Subayya Krishnamurthy as the observer for e-voting of unit holders on the six wound up schemes by Franklin Templeton Mutual Fund. The e-voting is scheduled to continue from December 26 to December 29.

The regulator has also constituted a technical team to assist Krishnamurthy. The names on the team include B N Sahoo, Chief General Manager, SEBI; Nayana Ovalekar, Chief Operating Officer of Central Depository Services Limited; K Sriram, Practising Company Secretary and Scrutiniser; and M Krishna and Ch E Sai Prasad, Assistant Directors of Central Forensic Science Laboratory, Hyderabad.

Krishnamurthy has served as the 13th Chief Election Commissioner of India from February 2004 to May 2005. During his tenure, he oversaw 2004 Lok Sabha elections.

ALSO READ: Get investors' consent for winding up 6 MF schemes: SC tells Franklin Templeton

"The Hon'ble Supreme Court of India vide its order dated December 09, 2020 has directed SEBI to appoint an Observer regarding the e-voting of unit holders of six schemes of Franklin Templeton Mutual Fund which is scheduled between December 26 to December 29, 2020. Further the Hon'ble Supreme Court has also directed that the result of the e-voting would not be announced and would be produced before the Hon'ble Supreme Court in a sealed cover along with the report of the Observer appointed by the SEBI," the market watchdog said in a statement.

"Accordingly, SEBI has appointed Taruvai Subayya Krishnamurthy, the former Chief Election Commissioner of India as the "Observer" on December 18, 2020," it further added.

Earlier this month, Supreme Court had asked Franklin Templeton Mutual Fund to call a meeting of unit holders to seek their consent for closure of six mutual fund scheme. The apex court had said there will be no redemption of units by investors till further orders.

ALSO READ: Franklin Templeton Mutual Fund's six shut schemes make Rs 941 crore in two weeks

Supreme Court had also agreed to hear an appeal filed by Franklin Templeton against the Karnataka High Court order which stopped the fund house from winding up its debt fund schemes without prior consent of the investors. On October 24, the Karnataka High Court had said that the decision of the Franklin Templeton Trustee Services Private Limited to wind up six schemes cannot be implemented unless the consent of the unit holders is obtained.

The six schemes wound up by Franklin Templeton are Franklin India Low Duration Fund, Franklin India Ultra Short Bond Fund, Franklin India Short Term Income Plan, Franklin India Credit Risk Fund, Franklin India Dynamic Accrual Fund and Franklin India Income Opportunities Fund.

Franklin Templeton MF closed these six debt mutual fund schemes on April 23, citing redemption pressure and lack of liquidity in the bond market.

Till November 13, the six schemes received total cash flows of Rs 9,682 crore from maturities, pre-payments and coupon payments since April 24, 2020.

ALSO READ: Highest ever equity MF outflows in November, but overall AUM at record high

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