Franklin Templeton crisis: Delhi petitioners apply to join hands with their Ahmedabad counterparts at Gujarat HC

The Delhi petitioners withdrew their plea against Franklin Templeton in the Supreme Court earlier today. The Supreme Court observed that there are already atleast three cases being heard in three courts – Gujarat, Madras and Delhi High Courts – against the fund house.

It advised the petitioners to explore others routes to move ahead and come back to Supreme Court in future if the need arises. The court also advised the petitioners to go to the capital markets regulator, Securities and Exchange Board of India (SEBI).

Challenging the HC order

Franklin Templeton has filed a special leave petition in the Supreme Court challenging the Gujarat High Court’s stay order. It has also filed a transfer petition in the Supreme Court asking for all existing proceedings against the fund house in other courts across the country to be heard under one roof – the Supreme Court.

“Meanwhile, we have already filed for an intervention petition in the Gujarat High Court to fight the case against Templeton jointly with the Ahmedabad-based petitioners,” says Puneet Jain, the advocate who represented the clutch of petitioners in the Supreme Court. This application is yet to be allowed in the High Court. If the Gujarat High Court permits the application, then Puneet will fight his clients’ case along with Ahmedabad-based petitioner, Areez Khambatta, in the Gujarat High Court.

“We have been receiving numerous queries from unitholders about the status of the writ petition filed before the 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 We wish to confirm that the matter was dismissed as withdrawn when it was taken up by the court today. 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 a Franklin Templeton spokesperson.

On June 8, the Gujarat High Court had dismissed Franklin Templeton’s application to set aside the stay order that the court has put on the e-voting process. The fund house had wound up six debt funds on April 23. It had then informed its unitholders about its plans of carrying out a voting exercise whereby they would either have to choose the fund house’s trustees or Deloitte for executing the winding up of schemes.

Unhappy with the fund house’s decision of winding up the schemes without taking unitholders’ consent, Areez Khambatta took the fund house to the Gujarat High Court to get a stay order on the e-voting process. The voting was to be held from June 9-12. On June 8, the High Court heard Templeton, but dismissed its petition asking for vacating the stay order.