IG & Arbitration

Grievances

Investor Services Centre of the Exchange deals with the complaints of investors/Clients against the Members of the Exchange. Investors/Clients may lodge the complaints in the format prescribed, along with supporting documents either by sending email on grievance@mcxindia.com , submit their complaint to the nearest investor service centre or through online by clicking on the link provided below

Register E-complaint
Please refer to nature of the complaints stated below.
  • Complaints which fall within the purview of the Exchange
  • Complaints relating to trades that are executed on the Exchange Platform
  • Complaints pertaining to commodity futures traded on the Exchange platform
  • Complaints in cases where no settlement could be reached between the trading member and the complainant for settlement of claims
  • Complaints in cases where the member has surrendered his membership and the complainant has approached the Exchange before expiry of the time mentioned in the public notice
  • Complaints against trading members on account of the following :
    1. Non- receipt of documents viz member client agreement, contract notes, settlement of accounts, order trade log etc.
    2. Non- refund of margin money
    3. Trades executed without adequate margins
    4. Delay /non – receipt of funds
    5. Squaring up of positions without consent
    6. Unauthorized transaction in the account
    7. Unauthorized transfer of funds from commodities account to other accounts
Yes there is a specified form for lodging complaint i.e Client Complaint Form (CCF)
It is advisable to give as much information as is available with the complainant for judicious processing of the complaint.

Arbitration

Arbitration is a quasi-judicial process of settlement of disputes between Trading Members and its Client/investors. Arbitration aims at quicker resolution of the disputes. When either of the parties is not satisfied with the complaint resolution process or the complaint is not resolved amicably between parties, the parties may choose the route of arbitration as per Rules, Byelaws, and Business Rules of the Exchange.
(a) Investors/Clients who have disputes against the Members with regard to trades and transactions done on the Exchange; 
(b) Members who have claim, dispute or difference against Client/investors /Authorised Persons with regard to the trades and transactions done on the Exchange.
The application for arbitration has to be filed at the Regional Arbitration Centre (RAC) viz. Mumbai, Delhi, Kolkata or Chennai covering the state in which in which the constituent ordinary resides.
The limitation period for filing an arbitration application shall be governed by the law of limitation i.e. The Limitation Act, 1963. However, the time taken in dispute resolution proceedings, if any, initiated by the Exchange /IGRC to resolve the claims, differences or disputes shall be excluded for the purpose of determining the limitation period.

Complaint resolution through Investor Service Cell (ISC) is administrative in nature whereas arbitration is a quasi-judicial process. Hence, once arbitration proceedings are initiated against the Member, the complaint filed with the ISC is treated as closed.

Lists of documents that are required to be submitted are provided below.

Forms/Documents Purpose

Mandatory

  • Form No. I: Application for arbitration
  • Form No. II: For providing Arbitrator preference in descending order
  • Statement of Case : Brief description of the case date wise, the basis of arriving at the claim amount and relief sought through arbitration
  • Cheque/Pay Order/Demand Draft towards cost of arbitration

Additional Documents *

  • Statement of accounts in case of dispute for funds
  • Copies of the relevant contract notes & Bills relevant to the matter or as per the direction given by the arbitrator
  • * In case clients does not have additional documents at the time of making application, same may be submitted during the course of arbitration.
Arbitration forms are available on Exchange website at http://classic.mcxindia.com and applicant may download the same and use the form for making application. Alternatively, investor/clients may request for forms by sending an email to arbitration@mcxindia.com along with the complete postal address, so that the forms can be mailed to them. The forms can also be obtained from any of the Regional Arbitration Centres.

If the value of claim made by the Applicant or counter claim made by the other party is less than or equal to 25 lakh, sole Arbitrator is appointed. If the value is more than Rs. 25 lakh, panel of three Arbitrator constituted.

Each of the parties to arbitration (other than a client with a claim / counter claim upto Rs. 10 lakh and filing the arbitration reference for the same within six months) shall deposit an amount, as may be prescribed by the Exchange, at the time of making arbitration reference. The deposits (exclusive of statutory dues - stamp duty, service tax, etc.) shall not exceed the amount as indicated under:
Amount of Claim /Counter Claim, whichever is higher (Rs.) If claim is filed within six months If claim is filed after six months
≤ 10,00,000 1.3% subject to a minimum of Rs.10,000 3.9% subject to a minimum of Rs.30,000
> 10,00,000 - ≤ 25,00,000 Rs. 13,000 plus 0.3% amount above Rs. 10 lakh Rs. 39,000 plus 0.9% amount above Rs. 10 lakh
> 25,00,000 Rs. 17,500 plus 0.2 % amount above Rs. 25 lakh subject to maximum of Rs. 30,000 Rs. 52,500 plus 0.6 % amount above Rs. 25 lakh subject to maximum of Rs. 90,000

A client, who has a claim / counter claim upto Rs. 10 lakh and files arbitration reference shall be exempt from the deposit. Expense thus arising with regard to such application shall be borne by the Exchange.
For the purpose of computing the six month period following would be considered:
  • six month period shall be computed from the end of the quarter during which the disputed transactions were executed/settled, whichever is relevant for the dispute and after excluding:-
    • Time taken by the IGRC from the date of receipt of dispute, till the decision by the Committee to resolve the dispute.
    • Time taken by the Member to attempt the resolution of the dispute (the time from the date of receipt of the dispute by the Member to the date of receipt of the Member’s last communication by the Client) or one month from the date of receipt of the dispute by the Member, whichever is earlier.
Stamp duty is applicable on the Awards passed by arbitrators. The amount of stamp duty payable is to be deposited along with the deposit mentioned in (9) above. Initially the stamp duty is to be deposited with the Exchange based on the claim amount of the matter filed and on passing of the Award, the stamp duty is calculated on the final Award amount passed in the matter. The amount of stamp duty payable on the Award is governed as per the stamp duty applicable to the particular state and may differ for every Regional Arbitration Centre (RAC).
 
The Respondent has to reply by way of Form No: II provided to him by the Exchange. The Form II comprises of respondent’s choice of arbitrators and Form No: III with statement of defense to the claim along with the required deposit amount.
 
No hearing is afforded to the parties to the dispute if the value of the claim difference or dispute is Rs.One lahh or less. However, if the value of claim, difference or dispute is more than Rs.One lakh, the arbitrator shall offer to hear the parties to the dispute unless both parties waive their rights for such hearing in writing.
The Sole/Panel of arbitrator required to complete arbitration proceedings within four months from the date of appointment of arbitrator/s and pass the Award. However, the period can be extended by two more months by the Managing Director or Relevant Authority or any officer (s) authorised by the Board, based on the request of either of the parties to arbitration or the arbitrator panel.
if after the appointment of an arbitrator, the parties settle the dispute amicably then the arbitrator will record the settlement of the dispute in the form of an arbitration Award on agreed terms.
 

Award is judgment passed by the arbitration panel which gives a direction to either of the disputing parties as regard to their claim raised in the arbitration matter.
If either of the parties is aggrieved by the Award, the aggrieved party may approach the Exchange with an application in the prescribed format for appeal before the appellate Tribunal, along with applicable deposit, within a period of 30 days from the date of receipt of the Arbitral Award. The aggrieved party can challenge the Award u/s 34 of Arbitration and Conciliation Act, 1996 in the court nearest to the address provided by Client in the KYC form or as per the change in address communicated thereafter by the Client to the Member.
The Award once passed by the arbitrator is final and binding on the parties unless challenged before a higher forum. In case of certain corrections or interpretation required to be made in the Award, any party to arbitration can file application with the Exchange u/s 33 of Arbitration and Conciliation Act, 1996 for correction or interpretation of Award, within one month from the date of receipt of Award. The Exchange will forward the application to the concerned arbitrator/s and in case the arbitrator/s feel/s the requirement of correction/interpretation in the Award as requested, he can do so by passing a separate order.
When the Arbitral/appellate Award passed in favour of the Client, the Exchange shall, on receipt of the same, debit the amount of the Award from the security deposit or any other monies of the Member (against whom an Award has been passed) and keep it in a separate escrow account with the exchange. The Exchange shall implement the Arbitral Award, by making payment to the client, along with interest earned on the amount that has been set aside, as soon as the time for preferring an appeal before the appellate panel of arbitrators has expired and no appeal has been preferred.
Forms and lists of documents required to be submitted while filing an appeal application with the Exchange are as follows

Mandatory
  • Form No. IV: Application for arbitration
  • Form No. V: For providing Arbitrator preference in descending order
  • Statement of appeal: Brief description of the grounds which are to be placed in the appeal and relief sought through the appeal process.
  • Cheque /Pay Order/Demand Draft for Rs. 30,000/- in favour of MCX (exclusive of statutory dues - stamp duty, service tax, etc.).In case of Claim/counter-claim of the investor/client is upto Rs. 10 lakhs, then the investor/client shall pay a fee not exceeding Rs. 10,000/- (exclusive of statutory dues - stamp duty, service tax, etc.)..

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