Franklin Templeton case: SC directs Rs 9,122 crore disbursement to unit holders

The court gave 20 days time for distribution of money to unit holders

The Supreme Court on Tuesday directed that a sum of Rs 9,122 crore should be disbursed to the unit holders in Franklin Templeton six mutual fund schemes.

A bench of Justices S Abdul Nazeer and Sanjiv Khanna said that Rs 9,122 crore (the figure as on January 15, 2021) should be distributed to unit holders in proportion to the respective interest in the assets of the scheme.

The top court asked SBI mutual funds to carry out the exercise of disbursement, after counsel for all parties agreed to this arrangement.

Advocate Pratap Venugopal, representing the Securities and Exchange Board of India (SEBI), submitted before the bench that if SBI mutual funds is involved then the disbursal would be completed equitably within 12 to 18 months.

The counsel representing Franklin Templeton Trusts Services Limited and Asset Management Company Limited agreed to fully cooperate with SBI mutual funds.

The bench also allowed the parties to move applications in case of any difficulty in the overall process.

On January 25, the court had said it would first deal with the "contentious" issue of the objection to the e-voting process for winding up Franklin Templeton's six mutual fund schemes, and of distribution of money to unit holders.

The court had earlier asked the SEBI to appoint an observer to oversee the e-voting process. This voting took place in the last week of December, and it was approved by the majority of unit holders. The court had also directed that the SEBI should file a copy of the final Forensic Audit Report before it, in a sealed cover.

The top court, on January 18, had granted three days for filing objections to the e-voting on winding up of six mutual fund schemes of the fund house. The court had also asked fund house counsel if an order could be passed to allow distribution of money to the unit holders.