HSBC Mutual Fund moves SC against SAT

Written by Indu Bhan | Indu Bhan | New Delhi | Updated: Jan 3 2013, 05:53am hrs
HSBC Mutual Fund on Wednesday moved the Supreme Court against the Securities Appellate Tribunals (SAT) order directing the asset management company to compensate losses suffered by some investors in a debt schemes.

A Bench headed by chief justice Altamas Kabir posted the matter for hearing on Monday after Sebis counsel argued that it has not been served a copy of the appeal.

Asking the asset management company to make good the losses in the same scheme, SAT had May last year had ordered HSBC Mutual Fund to provide an exit route to its investors in HSBC Gilt Fund Short Term Plan where the fund house had modified the fundamental attributes without informing its unit holders.

Similar order was passed in other case on July 5, this year which were listed before the bench.

The fund house had argued that the May order could not have been implemented in the present appeals as the investors had already left the scheme before March 12, 2009, when the change made in the scheme came into force.

Sebi rules mandate fund houses to inform investors of any changes in the policy whether fundamental or otherwise, which would affect the interest of the investors.

The market regulator had earlier warned HSBC Mutual Fund, its chief executive officer and the trustees to comply with the regulatory norms for asset management companies.

Ruling in favour of the investors, SAT set aside Sebis order and directed the fund house to compensate the losses. After this, other investors also moved SAT seeking similar order.