The Securities Appellate Tribunal (SAT) on Monday stayed the June 7 order of the Securities and Exchange Board of India (Sebi) barring Franklin Templeton Asset Management (India) Pvt Ltd from launching any new debt scheme for two years.

In an interim order, the tribunal also asked the fund house to deposit Rs 250 crore in three weeks as it felt that the market regulator’s direction to deposit Rs 512.50 crore was “excessive” at this stage.

This will be, however, subject to the result of the appeal.

Sebi in its order had asked Franklin Templeton to refund investment management and advisory fees of Rs 512.50 crore and pay a penalty of Rs 5 crore.

The matter will be heard again for final disposal on August 30.

Franklin Templeton MF had shut six debt schemes on April 23, 2020 citing redemption pressures and lack of liquidity in the bond market.

The schemes — Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund, Franklin India Credit Risk Fund, Franklin India Short Term Income Plan, Franklin India Ultra Short Bond Fund and Franklin India Income Opportunities Fund — had an estimated Rs 25,000 crore as assets under management.

Sebi in its order found that Franklin Templeton MF had “committed serious lapses/violations with regard to scheme categorisation (by replicating high–risk strategy across several schemes) and calculation of Macaulay duration (to push long term papers into short duration schemes)’’.

It also committed violations in respect of non–exercise of exit options in the face of an emerging liquidity crisis, securities valuation practices, risk management practices and investment related due diligence, the regulator had noted.

“We find that the appellant (Franklin Templeton MF) has been in this business for more than two decades and some of the schemes have been in existence for more than 10 years. No complaints whatsoever have come on record to indicate the poor management of the schemes by the appellant.

“We have been informed that the appellants were running 48 equity and debt schemes out of which 28 were debt schemes and as on date six schemes have been wound up by the appellant and, therefore, 21 debt schemes are still running,’’ the division bench of Justice Tarun Agarwala and Justice M.T. Joshi said in the order.