Axis Mutual Fund (MF) has been sued by its former employee Viresh Joshi for wrongful termination. Joshi has also sought Rs 54 crore in damages. His law firm Mansukhlal, Hiralal & Co filed a suit before the Bombay High Court earlier this week. The matter was listed for hearing next week.
On May 20, Axis MF terminated the employment of Joshi, a chief trader and fund manager, due to alleged irregularities. Axis MF hadn’t cited any reason for the termination.
Joshi’s lawyers claimed the termination to be null and void as due cause had not been shown by the fund house. Further, the lawsuit claims Joshi wasn’t given an appropriate opportunity for a hearing.
“The termination notice is invalid and we have sought cancellation of the same. We have also claimed Rs 54 crore in damages,” Purvi Asher, partner, Mansukhlal, Hiralal & Co told Business Standard.
Axis MF couldn’t be reached for a comment immediately.
Before terminating Joshi, Axis MF had suspended him and assistant fund manager Deepak Agrawal following a whistle-blower complaint alleging front-running and violation of other securities law.
The fund house also roped in two agencies to investigate the front-running case. The agencies have been tasked with identifying lapses, ascertaining if other individuals were involved in any way and also finding the amount of illegal gains that could have been made.
Meanwhile, the Securities and Exchange Board of India (Sebi) too has launched a separate probe into the matter. In May, Sebi carried out extensive search and seizure operations across multiple cities to gather evidence on alleged front-running. The regulator has seized various records, documents and digital evidence from phones, laptops and hard drives used by 16 suspected entities.
Joshi has been associated with Axis AMC since 2009. His core responsibilities included managing arbitrage fund & derivatives trading strategies. He used to oversee Axis Arbitrage Fund, Axis Technology ETF, and Axis Consumption ETF. Agrawal joined Axis AMC in 2015 as research analyst, equity. He was promoted to assistant fund manager (equity) in 2020. Since 2021, he has been managing the Axis Quant Fund and the Axis Consumption ETF.
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