In a e-mail communication with investors, post the Karnataka
high Court judgement, on October 24, Sanjay Sapre, president of Franklin Templeton Asset Management
said the fund house
is likely to appeal aspects of the order in the Supreme Court
. The fund house will also endeavor to seek appropriate directions from the court regarding return of cash of over Rs 5200 crore currently accumulated in the four cash positive schemes, and with regard to any additional cash it receives while the matter remains under the consideration of the Karnatka High Court
. The court has stayed the operation of its judgement for 6 weeks, and the funds remain subject to winding up at this time.
In the email communication, Sanjay Sapre informed unitholders that regulation 39 to 42 of the SEBI (Mutual Funds) Regulations 1996, that deal specifically with winding up of the schemes have been held to be constitutionally valid. The Court has also upheld the decision taken by the Trustee, to wind-up the schemes and as per the judgement, consent of the unitholders will be required under regulation 18(15)(c) to operationalize the above decision.
He informed unit holders that the fund house is studying the order and will come back to investors with additional details around the same if there is any need.