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The High Court of Judicature of Karnataka on Wednesday in the matter 'Amruta Garg versus Union of India' issued notice to centre, Security exchange board of India (SEBI) and Franklin Templeton company in a batch of suits filed against the company for its decision to wind up almost six debt schemes.
Franklin Templeton is an American based investors management company in April 2020 notified its investors that it was winding up several schemes in list such as Franklin India low duration fund, dynamic accrual fund, credit risk fund, short term income plan, etc.., worth 28000cr and reasoned its move by stating "Lack of liquidity in bond market" due to covid19 pandemic which at-least will hit 3 lakh investors.
As a result batch of petitions were filed before the apex court which on June 19 transferred/ directed the registry to transfer it to Karnataka bench within 15 days. Supreme court, further insisted chief justice of Karnataka to close the matter within 3months time.
Before the transfer the apes court had orally observed that decision of winding up several schemes were erroneous and incorrect.
In early June, the Delhi HC had issued notice in petition challenging Franklin Templeton trustee service decision (Amruta Garg Vs UOI & Ors)
After hearing the matter today, division bench comprising Justice Abhay Shreeniwas Oka and Justice Ashok Kinagi directed all parties to file response by July 22 and replies to it by July 29th.
During the hearing, Karnataka HC also directed its registry to remind Madras HC registry to transfer all related matters and also simplified that it would allow matters only which apex court transferred and not any other.
" Since the matter have to be decided within 3 months as per Apex's court direction hearing will be taken up 2 to 3 times a week" said CJK.
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