1.

Tender and delivery period: The tender and delivery period will commence on 1st day of the contract maturity month or if 1st day is a holiday, then it would commence on immediate subsequent working day. Normal trading in a contract will continue upto the last trading day prior to the day of commencement of tender and delivery period.

2.

Delivery period margin: With effect from the date of commencement of tender and delivery period, the delivery period margin of 25 % on the net outstanding position will be applicable. Such margin will be applicable on the net outstanding position at member level in the contract entering into delivery period. If two clients of the same member have outstanding position in such contracts, the member himself can settle the delivery among his clients and such delivery will not be routed through the Exchange mechanism and therefore on such offsetting positions, the Exchange will not charge any margin, though the member is entitled to charge delivery period margin from such clients till fulfillment of their obligations.

3.

Designated Tender Days: The tendering of deliveries shall be permitted only on specific tender days during the delivery period. Such tender days will be notified by the Exchange in advance. The first tender day will be 2nd day of tender period and the last tender day will be 1st May (subsequent working day if 1st May is a holiday) and in between there will be ten tender days, which will be notified by the Exchange in advance.

4.

Tender Notice: On each of the designated tender days, the members having net outstanding sale position in the maturing contract may submit a tender notice by 3 p.m. indicating the quantity they intend to deliver, alongwith place of delivery, address of the warehouse / go - down, etc. Such tender notice shall be submitted in the format specified by the Exchange alongwith proof of delivery, surveyor's certificate, etc. The tender notice in legal parlance would mean just an intention of making delivery and not an actual sale. Once a seller has submitted a tender notice for specified quantity, he shall not square off his outstanding position to the extent of tender submitted by him. Such tender notice shall be in the format specified by the Exchange and shall be submitted at the corporate office of the Exchange by fax or courier, so that it reaches the office latest by 3 p.m. on the date of Tender Notice.

5.

Buyer's intention and allocation of tender order: The net buyers having net buy position on the date of commencement of tender and delivery period, which is 1st day of the contract maturity month, have to indicate an intention by 3 p. m. for lifting delivery on such day. On the basis of such intention received from the buyers, the tender notice received from the sellers is firstly allocated among the willing buyers and residual quantity, if any, is allocated to other buyers, irrespective of the fact whether they have given their intention for lifting delivery or not. Further, the buyer will not have any option about choosing the pace of delivery, rather he has to accept delivery as per allocation made by the Exchange and communicated to him by end of that day. Once a delivery is allocated to a buyer, he shall not square off such position. The allocation of Delivery Orders to Members with net buy or long positions shall be final and binding on all members to whom it has been allocated and under no circumstances a member shall have any right to refuse or challenge the delivery allocation in his favour.

6.

Buyer's option: If a delivery is allocated to a buyer on the 1st day of the tender and delivery period, on the immediate succeeding day he is required to submit a request to the Exchange in the specified format stating that he is not willing to lift delivery and wishes to settle the contract by way of paying the penalty. In such a case, such buyers are required to settle the contract as per the Delivery order rate and also to pay a penalty of 2 % of the Delivery order rate. In such case, the seller is informed by the Exchange by the next day, that is 3rd day of the tender period, asking him not to deliver the commodity, and to settle the contract with the buyer as stated above. In addition to above, the seller gets 90 % of the penalty amount recovered from the buyer so as to compensate him. The same right is available to the buyer in case of all subsequent tenders. In other words, if the seller offers delivery on the 2nd designated tender day, the buyer will get this option to be exercised within 1 day of such tender.

7.

Payment by the buyer: In case the buyer does not exercise his option as stated under point no 6 above within 1 day of getting tender, then it is assumed by the Exchange that he is interested to lift delivery, even if he had not shown any intention on the 1st day of tender period. Therefore, all such buyers are required to make payment within 2 days of getting tender document. The payment is to be made as per delivery quantity allocated to him multiplied by the closing price of the maturing contract on the previous day, which is subject to again adjustment with respect to quantity and quality. In case a buyer fails to make payment, the action relating to his declaration as defaulter is initiated.

8.

Delivery Orders: All deliveries tendered by sellers on designated tender days shall be in the form of `Delivery Orders' issued in favour of the buyers, as per instructions of MCX. The Delivery Orders shall be filled up in the prescribed form and shall clearly state the contract particulars including quantity, quality and the delivery center, which should be accompanied with a bill in favour of the buyer. The Delivery Orders must be received by MCX by 3.00 pm on the specified delivery days, otherwise it is treated as valid only for the subsequent delivery day.

9.

Each delivery order issued shall be in multiples of minimum deliverable lots. The seller is responsible for arranging delivery at his own cost at the specified delivery center, which must be (i) either within 30 Kilometers radius of municipal limits of Surendranagar; or (ii) within Kadi municipal limit. The cost of loading will be on account of the seller, while the cost of unloading as well as cost of transportation will be on account of the buyer. One seller must indicate only one godown as destination in one contract and he cannot chose multiple go downs for the same contract. The tenderer of delivery order shall also clearly disclose the identity of the Member/Registered Non-Member, if any, who shall be performing the delivery. The seller shall not issue delivery order at a place where there is a restriction against movement of goods from such place by any person or Government authority or local authority at the time of issuing such delivery order. The seller shall, at his cost, give permit to the buyer wherever such permit is necessary for movement of goods. If the seller is unable to supply such permit to the buyer, it will be treated as no delivery and he shall be liable to pay such penalty as may be applicable for failure to tender delivery.

10.

Delivery Order once submitted cannot be withdrawn or cancelled or changed, unless so agreed by MCX in writing.

11.

Delivery Lot: The kapas contracts traded at MCX are deliverable in lots of 4 MT. Members with a short open position opting to tender deliveries shall be permitted to issue Delivery Orders only in such lots.

12.

Permissible limits for Delivered Quantity: The delivery shall be deemed to have been provisionally completed for each delivery order whenever the seller has delivered the quantity for that delivery order within a tolerance limit of 100 Kg. The delivery is considered as fully complete only after the buyer confirms receipt of delivery with the same quantity and quality. If the buyer has any dispute about the quality, he has to raise it immediately at the time of getting the truck load of Kapas. Once the Kapas is unloaded and is delivered in his godown, thereafter the seller is not responsible for any quality difference.

13.

Delivery Grades: The Members tendering delivery will have the option of delivering such grades of kapas as permitted by the Exchange under the contract specification. The buyer will not have any option to select a particular grade and the delivery offered by the seller and allocated by the Exchange shall be binding on him.

14.

The Member tendering delivery will clearly specify the grade to be delivered in the Delivery Order. Once the delivery grade is specified, it cannot be changed for the same Delivery Order. Such delivery grade shall be in conformity with the surveyor's certificate accompanied with the delivery document.

15.

The procedures followed for drawing samples and carrying out analysis tests shall be as per booklet issued by Bureau of Indian standards.

16.

The cost of survey and issuance of certification by an approved surveyor shall be borne by the Member submitting the Delivery Order.

17.

Pricing of Delivery Order: The basis price for a Delivery Order shall be the settlement price of the concerned contract on the previous day of the tender day. The basis price arrived at as above will have to be adjusted by applying the discount / premium in respect of quality.

18.

Taxes, Duties, Cess and other Levies: The purchase tax, octroi, APMC charges or any other levies or local taxes are not inclusive in the price.

19.

Publication of Delivery Orders Issued and Allocated: MCX shall display on its system, within reasonable time, full details of Delivery Orders received on each designated tender day and the allocation made against the same.

20.

Endorsement of Delivery Orders: The Delivery Orders allocated to the member with net long position shall be freely endorsable by him to his clients who may be either a member or a client. Such allocation can also be made by the buying member in favour of a third party, but such allocation can be only once and subject to the full disclosure of details of the third party to be given to MCX. However in case of dispute or default involving the endorsee, the responsibility for contractual performance shall remain vested with the original assignee of the Delivery Order (the buying member).

21.

Delivery Procedure: The Member or his client taking delivery of Kapas must lift delivery within 7 working days from the date of getting instruction from the Exchange. 

22.

The buyer has to intimate to the seller the programme for taking delivery of the tendered goods within one day of getting instruction from the Exchange for giving delivery, with a copy to the buyer. The buyer has to confirm and intimate in writing to the seller with a copy to MCX immediately on receipt of such information from the buyer about his confirmation or change request in such schedule.

23.

Weighment at the time of delivery: The goods tendered shall be weighed at seller's option, at the buyer's weigh-bridge or at an independent weigh-bridge to be mutually agreed, and weights determined in this manner shall be treated as final and fully binding on both the parties. The seller's representative shall present himself at the warehouse installation at the time of delivery. 

24.

Delivery shall be treated as complete if the Seller supplies a quantity that is within the minimum and maximum prescribed quantity. When a certain quantity is supplied and if it falls short of minimum permissible quantity then the delivery is not acceptable. Likewise when quantity supplied is more than maximum quantity then the balance shall be treated as excess quantity. For calculating the final shortage or excess delivery, the total quantity delivered by a seller is to be considered collectively as well as the minimum truck load permissible in each instance.

25.

In case of a shortage the Buyer shall be entitled to claim the difference between the price payable as per the Delivery Order and the market price on the date of delivery from the Seller if the ready market price is higher; whereas in case of excess delivery the Buyer will pay for the excess quantity at the price which is lower of the delivery order price or the ready market price on the date of delivery.

26.

Sampling and Analysis at the time of Delivery: In case the Buyer does not agree to the Surveyor's report as to the quality of the commodity, he shall desire for second sampling.

27.

28.

If the first sample as examined by the Buyer's surveyor fails to conform to the quality standards specified, the Buyer shall intimate the seller within 72 hours of collection of sealed sample along with a copy of the analyst's report. The seller shall immediately send the second sealed sample to an approved laboratory, which is also agreed by the buyer. The result of the same shall be binding on both the parties. In the event the Buyer and Seller do not mutually reach agreement with the results of the second sample test, then MCX shall send the third sealed sample to any one of the approved laboratories / surveyor, as decided by the Exchange.

29.

The analyst's report of the approved and agreed independent laboratory shall be forwarded by MCX to the parties immediately on receipt of the same. In such case, the final payment to the seller will be made on the basis of test report received by the Exchange pursuant to the third test. The Exchange will also direct the party, in whose favour the result is declared to collect the cost of tests and detention charges from the other party. In case the commodity stands rejected then the seller shall be given 48 hours from the day of rejection to re-tender the goods. If the re-tendered goods do not conform to the quality standards, then it will tantamount to failure on the part of the seller to give delivery, which shall be closed out as per the Due Date Rate treating the same as shortage.

30.

In order to ensure that tests are exactly comparable and that the results are consistent, the independent analyst shall determine the particular analytical test by applying the methods specified in relevant ISI. The analyst shall be required to append a certificate to that effect to the analysis report issued by him.

31.

Cost of Transportation and Insurance: The Member or his client issuing the Delivery Order and giving delivery shall maintain adequate insurance cover for commodity held in stock prior to delivery and in transit and in no circumstances either MCX or the Member or his client taking delivery will be responsible for any losses prior to delivery being completed.

32.

Payment by MCX to the Tenderer: MCX shall pay the invoiced amount to the Member tendering delivery on completion of delivery and receipt of confirmation from the buyer to this effect. However, if the buyer fails to confirm or raise objection within such time, as may be specified by the Exchange for respective commodity, then the Exchange will pass on the proceeds to the seller. The price of delivery is based on the closing price of the maturing futures contract on the date of actual delivery by the seller and in case delivery is offered on the 16th day of contract maturing month, it would be the closing price on the last day of the contract. If there is no trade on the last day, then it would be the last closing price. Payment is released to the seller only after getting confirmation from the buyer about completion of delivery. However, if the buyer delays giving such certificate beyond 1 day from the date of getting delivery, payment will be released to the seller, after giving a written notice to the buyer.

33.

Extension of Delivery Period: The Exchange shall have the power to extend the period of delivery or provide for longer period of delivery in the Delivery Order itself if such an extension of time has become necessary due to a force majeure.

34.

Process after contract maturity: The last date for tendering delivery is 1st May (next working day if 16th is a holiday). For all positions, which did not result into delivery, the final settlement will be done on the basis of Due Date Rate. 

35.

Due Date Rate: In order to settle all outstanding position not settled by way of delivery, Due Date Rate is calculated on 30th day of the month. This is calculated by way of taking simple average of last 5 days of the spot market. For the purpose of kapas, the spot market price will be obtained from Surendranagar. For obtaining the prices of spot market, the Exchange will take the prices from a panel of dealers and brokers and take the average out of 3 prices taken on a day from three different entities. In addition to this, the seller who does not deliver goods, will be subject to a penalty of 2 %, out of which 90 % will go the buyer, who could not receive delivery and 10 % will be appropriated by the Exchange. 

36.

Applicability of Business Rules: The general provisions of Business Rules relating to the procedures not specifically laid down in this circular and decisions taken by FMC/ Board / Executive Committee in respect of matters specified above will apply mutatis mutandis.