Last time, it took the company around 30 months to find a new MD and the court should extend Puri's tenure by 12 months or any other period as it deems fit, said Chagla.
He emphasised on the urgency of the matter, given Puri's five-year term ends on Monday. A bench comprising Justice R M Borde and Justice P K Chavan will hear the matter on Monday. Sources said top officials of the fund house held a meeting on Thursday, where they decided Rahman would be the right choice to take over if Puri's extension doesn't go through. Previously, Rahman had acted as interim CEO of UTI MF in 2012, when shareholders had contested the appointment of the next chief following U K Sinha's departure to Sebi. "As all the stakeholders haven't been on the same page on whether Puri should continue, the new CEO appointment process was never initiated. Rahman's interim appointment is seen as an acceptable solution for all parties involved," said a source privy to the development.
Meanwhile, T Rowe Price is throwing its weight behind Puri's extension by moving court. The Finance Ministry, Securities and Exchange Board of India, UTI AMC, UTI Trustee Company, and the four state-owned shareholders — LIC, State Bank of India, Bank of Baroda and Punjab National Bank have been named respondents in the petition filed by T Rowe Price, which is the only private sector shareholder in UTI MF.
In an interaction with Business Standard, T Rowe Price had highlighted issues pertaining to corporate governance standards and disruption in board functions by state-owned shareholders.
Sebi regulations stipulate that no sponsor of a mutual fund can own 10 per cent or more of any other MF, or have representation on the board of an asset management company or trustee company of any other MF -and must be in compliance with this regulation by March 13, 2019. Each state-owned shareholder in UTI MF owns an MF subsidiary.
Without naming anyone in particular, T Rowe Price spokesperson Edward Giltenan said, "They have created conditions that prevent timely compliance with Sebi's regulation, requiring each of them to sell below 10 per cent." Giltenan added the decision to approach court was also taken as T Rowe has an obligation to protect its long-term investment in UTI MF.
Imtaiyazur Rahman is CFO and head of global operations at UTI MF
He previously served as interim CEO in 2012
He has spent 15 years at the fund house