On January 1, 2021, the NCDEX issued a circular (NCDEX/INVESTOR SERVICES-001/2021) regarding the investor grievance redressal mechanism. This circular was in reference to the following two circular issued by the exchange earlier.
- Circular numbered NCDEX/INVESTOR SERVICES-004/2016/265, dated October 3, 2016 on “Procedure for redressal of Investor Grievances” and the Exchange”
- Circular numbered NCDEX/INVESTOR SERVICES-001/2020 dated November 10, 2020 on “Investor Grievance Redressal Mechanism”
The revised guidelines were attached in an annexure to the circular, and the key points to be noted are as follows.
Resolution of complaints by the exchange and handling of complaints by GRC
1. If the exchange has received a complaint and if any additional information or documents are required thereafter, then the exchange must seek such details from the complainant within 7 working days from the date of receiving the complaint. The complainant must provide such information in the form and manner specified by the exchange.
2. After the complainant has provided the information required, the complaint must be registered and forwarded to the Member. The exchange must attempt to resolve the complaint within 15 working days from the date of receiving the additional information.
3. Upon receiving the complaint, the Member must immediately begin to act upon the same and revert to the exchange with the details of the redressal with responses and supporting documents. The Member must communicate these details to the exchange on its email ID (email@example.com) within the time specified by the exchange.
4. If the issue is not resolved by the exchange within 15 days from the receipt of the complaint or the additional information, as the case may be, it shall be referred to the Grievance Redressal Committee (GRC).
5. The GRC must amicably resolve the complaint using the conciliation process within 15 days. In case the GRC needs any additional information, it may request the exchange to provide those details before the conciliation process. In case such additional information is sought, then the GRC must resolve the complaint within 30 working days.
6. Members and complainants must co-operate by remaining present for the GRC meeting and must ensure that any authorized representative appearing before the GRC is adequately empowered to take decisions at such a meeting.
7. The GRC must not dispose of any complaint citing “Lack of information and complexity of the case” as a reason. The GRC must give its recommendation to the exchange.
8. Once the proceedings have been concluded, the GRC must decide upon the claim value admissible to the complainant. In the cases where the GRC has decided the admissible claim in favor of the investor, upon the receipt of the GRC directions, the exchange must block 100% of the amount out of the deposit of the Member available with the exchange. Or, in cases where the member authorizes the exchange to utilize the deposit available with the Clearing Corporation, then such deposits must be utilized. If the deposits of the Member fall below the requirement due to such blocking, then the Members’ ability to trade may get impacted. The intimation of such blocking must be given to the Member.
9. The Member must inform the exchange via a letter or an email about whether or not it intends to pursue the next level of resolution, which is Arbitration, Such information must be given within 7 days from the date of the GRC direction.
10. If no such intimation is received from the member within 7 calendar days, the amount decided as admissible will be released to the investor. This shall be done out of the amount blocked from the Member’s deposits available with the exchange/CC, as the case may be. Intimation of such a release will be given to the Member. However, in case any confirmation of settlement of claim is received from the investor before the release of such funds to that investor, the amount debited will be refunded to the Member.
11. If the Member provides its intention to pursue Arbitration, but does not file the relevant application within 6 months from the date of GRC direction, the Exchange must release the blocked amount to the investor. Additionally, in such cases, the Exchange shall not be liable to refund or recover the amount paid to the investor(s).
12. Aside from trade and settlement related complaints/grievances, service related complaints in the following categories shall also be taken up for redressal at the Exchange:
- Non-receipt/ delay of account statement
- Non-receipt/ delay of bills
- Closure of account/branch
- Technological issues
- Shifting/closure of branch without intimation
- Improper service by staff
- Freezing of account
- Alleged debit in trading account
- Contact person not available in member’s office and/or
- Demat account transferred without permission
All claims, differences, or civil disputes between the Trading Member(s), Constituents, Authorised Persons and Clearing Member(s) that arise in relation to transactions made shall be submitted to arbitration as per the provisions of the Byelaws and Regulations of the Exchange & the circulars issued thereunder.
The provisions mentioned in this circular are applicable for complaints received and GRC orders passed on or after January 01, 2021