The National Commodity & Derivatives Exchange Ltd (NCDEX) faced second incidence where traders complained against it for alleged delivery default. Earlier delivery issues were raised in case of steel billets and now a police complaint has been registered by a potato trader.
Purshottam Nagpal, director of Pooja Cold Storage Pvt Ltd., based at Ganganagar (Rajasthan) - has filed police complaint against seven officials of the industry. Police has registered an FIR.
Complaint is against two exchange officials, JICS Logistics Ltd, Indore; officials of broking house Karvy Commodities, a cold storage and an individual.
The local police in Ganga Nagar police station (Kotwali) registered the case on January 2 under CrPC Section 109, 120B, 406 and 420. The complainant alleged that the group of individuals had cheated him for Rs 2 crore.
Interestingly, Nagpal has neither made NCDEX a respondent to the complaint nor sought damages from anyone aforementioned. He has sought punishment under above various sections of CrPC.
“We will also initiate actions against NCDEX for claiming damages after seeking legal advice,” said Nagpal. He had purchased 4,837 tonnes of potato at NCDEX for September delivery. However, he was given delivery of only 1,235 tonnes of potato. The remaining quantity of 3,602 tonnes was not delivered and remained with the warehouse owners. And delivered quantity was also substandard, alleged Nagpal in the FIR.
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Nagpal alleged the warehouse and the exchange officials had sold entire quantity of NCDEX quality potato in the open market.
Ananda Kumar, chief of corporate services, NCDEX, said, “Potato is a compulsory delivery contract. Participants having open long position are bound to take physical delivery on expiry of contract. It is apparent that the complainant is making allegations about quality because prices fell and the complainant wanted to avoid taking physical delivery. The last expiring contract of the exchange in 2011 was in September.”
“We are contemplating appropriate legal action. We have also issued a legal notice to the complainant giving detailed facts,” he added.