The Maharashtra State Co-operative Cotton
Growers’ Marketing Federation Ltd.
Khetan Bhavan, 6th Floor, 198, Jamshedji Tata Road, Churchgate Mumbai – 20
Telephone : 56369650/56369651 Fax : 022-22875232
Email: msccgmfl@bom2.vsnl.net.in
Commercial Procedure and Practices
The Maharashtra State Co-operative Cotton Growers Marketing Federation Ltd. Is one of the major seller of quality graded Cotton in the country. Being a public sector organization it is expected to follow a fairly transparent system of buying and selling of cotton in Mahrarshtra. Though over the years the commercial practices adopted for the sell of cotton by the federation are generally known to the trade. It is now felt that time is opportune to refresh and make known about the revision in the commercial practices i.e. guidelines about terms & conditions, interest rate, carrying charges rate etc. to our customers.
The federation however reserves the right to change the guidelines without prior notice. Further if any ambiguity/difference of opinion arises on account of these guidelines, the decision of the federation would be final and binding.
1) Submission
of Offer:
1.1 Buyers may submit their offers in prescribed format either directly to sales office, Khetan Bhavan, Mumbai – 20 or through any other our sales offices in Maharashtra or out of Maharashtra. The offers received up to 3.30 pm. Only can be considered for the sales promotion committee meeting of that date. The offers received there after would be deemed to have been received on the following day and can be considered only for the next day’s S.P.C. meeting.
1.2 The offers would be received by the federation only in the prescribed format as per annexure I attached here with. The buyers however would be free to use their own offer forms. It is not mandatory to use the forms provided by the federation.
1.3 Federation will confirm the sale according to availability of stock.
2) Offer Acceptance and Counter:
2.1 Offer received will be placed for consideration in S.P.C. Meeting The acceptance of the offer would be communicated to the concerned buyers/brokers either in writing or through fax. In the event of any modification in any of the terms counter offer will be given by the federation with a time stipulation within which the buyer is expected to communicate his acceptance. In case the buyer is unable to adhere to the time specified in the offer, the offer of the federation shall lapse without further communication. Normally all acceptance of the counter offers is to be made in writing to the federation before 04.30 pm. of the next working day.
2.2 As soon as the acceptance of the counter offer is received by the federation and the required EMD is paid it would tantamount to the conclusion of the contract, subject to conditions of the offers/counter offers. Failure to fulfill these conditions shall make the defaulter liable to the damages suffered on account of non-fulfillment of the contract.
3) Earnest Money Deposit :
3.1 Payment of Earnest Money Deposit (EMD) should be made within 5 days (including the day of confirmation) from the date of confirmation of the offer. In case the buyer fails to fulfill the obligation the federation would be free to close the contract and reserve it’s right to claim the consequent damages. However buyer shall not have any right to claim any losses etc. , on account of such closure of contract by the Federation. Calculation of E.M.D. is on per bale basis.
e.g. If the offer is confirmed on the first January the last date of payment of E.M.D. shall be 5th January
3.2 However if last day of deposit is a local or Federation’s declared holiday then the next day immediately succeeding the holiday shall be the last date for payment. The payment will be accepted between 10.30 a.m. to 04.30 p.m. only.
4) Allotment Letter :
In accordance with Deal so confirmed for which E.M.D. is paid in stipulated time, an allotment letter will be issued stating zone, variety, grade and number of bales to the Dy. Manager (sales) in the concerned zone and to the buyer/broker/mukadam. Any other stipulation agreed by the Federation will also be incorporated in allotment letter.
5) Selection :
6) Preparation of Contracts :
After the acceptance of offer and remittance of earnest money (as applicable) and selection, the contracts are prepared at concerned zone offices. A copy of the same is given to the customer/broker. The buyers/brokers are requested to first collect the copies of the contract from the concerned zone, two copies of the contract will be sent to the mill by post out of which one copy is to be returned within 7 days after duly signed by the appropriate authority of the mill to the concerned Zonal Manager. The customer is requested to be present and ensure that lifting of the bale takes place as per contract terms, so that the levy of carrying charges/late lifting charges need not be paid for. It is worth to mention that the Federation at its discretion may carry the contracted bales for a period of 30 days after the expiry of delivery period. The carrying charges are required to be paid by the buyer from the next day of the expiry of scheduled delivery period. After the expiry of contract and Federations discretionary period the Federation may sell the unlifted bales and losses on account of such resale and carrying charges thereon are to be recovered from the buyer.
7) Collection and Signing of the Contracts :
At present many contracts are not returned to us duly signed by the mills or it’s authorised representative. The person who signs the contract should have the authority to sign such documents on behalf of the buyer and such copy of authority should be enclosed along with signed copy of contract in many cases the brokers/muccadams are signing the contracts. However such contracts will not be accepted in future if the same is not supported by proper authority from the buyer.
Contracts can be collected by authorized representative (employees /broker/ muccadams) on production of an authority letter from the buyer.
8) Payment of F.P. Cotton bales :
The customers are required to make payments as under:
a) Earnest Money Deposit = 1) Accounts Dept. Khetan Bhavan, Mumbai-20.
2) Zone Office.
3) Money can also be paid at following sales
offices.
1. Bangalore 2.Coimbatore,
3. Ahmedabad 4. Solapur,
5. In the office of Orrisa State
Co-operative Federation Bhuvaneshwar.
b. Balance payment = 1) Accounts Dept. Khetan Bhavan, Mumbai-20.
2) Concerned Zones and Sales Offices.
c) The Co-operative Spinning Mills situated in Maharashtra are now required to pay 25% margin money deposit unless and otherwise mentioned. They will be allowed to take delivery on production of bank guarantee for the balance payment. Mills are expected to make the payment within 14 days from the date of the delivery. However this is not adhered to, the interest would become payable by the mill as per decisions taken time to time.
d) The buyer has to effect payment and take delivery of the bales within delivery period from the date of (confirmation or deemed confirmation) contract, on failure on the part of the buyer to do so the contract is liable to be closed at the option of seller. In the event of such a closure the seller shall be entitled to resell the entire or balance quantity thereof at anytime and by any manner it deems fit and at the same time reserving its right to recover any damages/loss sustained by way of such resale including carrying charges as applicable w.e.f. the date of following due date of delivery under the provision of Sec. 40 and 41 of the Maharashtra Row Cotton (Procurement, Processing & Marketing) act of 1971 or under Sec.91 to 96 of Maharashtra Co-operative Societies act, 1960 for which buyer has no objection
9) Levy of Carrying Charges :
1 In case the payment is delayed beyond the due date of the delivery period mentioned in the contract the carrying charges would become payable at following rates
I. On spot delivery contracts = @ 2% p.m. (30 days)
II. On M.G.S.F. = @ 2% p.m. (30 days)
2 For calculating Carrying charges the date of contract is required to be added to the free delivery period
e.g. If a contract is entered into on 01.09.2003 and delivery period is allowed for 11 days then the due date of payment shall be 1+11 i.e. 12.09.2003. If 12th September happens to be a local holiday/ federation declared holiday, then the next working day shall be the last day for the payment.
3 In the above example even if the buyer makes payment on 13.09.2003 the carrying charges would be levyable for One day.
10)
Late Lifting Charges :
The buyer after making the payment is granted 7 days grace period for lifting the bales in contracts where the payment is made in cash/draft. In case where this lifting period is adhered, then late lifting charges @ Rs. 1/- per bale per day is payable by the buyer.
11)
Registration and responsibilities of Brokers.
The terms and conditions for registration and renewal of registration for brokers have been decided vide letter under reference. Some of the revised terms and conditions for registration and renewal of registration for brokers are as follows:-
(A) REGISTRATION
:
1.
Broker
should become nominal member of MSCCGMF by paying Rs.10/- as a nominal membership
fee, for which he has to apply in the prescribed form.
2. Broker should have his own office with telephone and fax facilities, and necessary knowledge of cotton business.
3. Broker should pay refundable deposit without interest of Rs.5000/- if he is a proprietor of the firm or Rs.10000/- if he is partner of a firm.
4. Broker should also attach his photograph in the application form.
5. Broker should bring at least one confirmed offer of at least 100 bales with the application in the prescribed format duly filled.
6. Newly registered broker entitled for brokerage i.e. @ 0.45% calculated
on actual bales value (excluding S.T. and Cash Discount amount) as
indicated in the Sale invoice to be applicable to all varieties of cotton and
categories / grades.
(B) PROCEDURE :
7.
After
completion of deliveries, Broker should produce the bills enclosed
with delivery completion certificate and
copies of 'C' or 'BC' forms
submitted or certificate of having paid
the M.S.T.
8. If the broker does not bring any business for 3 years Federation will keep the option to cancel the registration and his deposit will be refunded without interest after verifying the dues (if any).
9. The Federation keeps the option to withhold the amount of brokerage if the buyer makes the default and the broker does not cooperate for recovery of amounts due from buyer.
10. The Federation will not pay any amount of brokerage to the person who is not duly authorized by the broker or buyer.
11. Hereafter the renewal of the broker registration will be for a period of three year's, for renewal of registration broker should approach the Federation before 31st December and pay Rs.500/-. In case of failure of paying these Rs.500/- upto 31st December then he shall have to pay Rs.750/- till 31st January as broker renewal fees. In the event of non-renewal of the broker registered by the end of January as stated above, this registration will stand automatically cancelled after end of January and thereafter he has to apply for new registration.
12. The MSCCGMF reserves the right to cancel the registration of broker at any time without notice if he is found to have indulged in any act which is harmful and prejudicial to the interests of the Federation directly or indirectly. In such cases, his deposit is also liable to be forfeited.
(C) RESPONSIBILITY :
13. Broker should make efforts to bring the business to Federation.
14. Broker should apprise the Federation about market developments, supply, demand position in market.
15. It will be the broker's responsibility to facilitate the deposit of EMD and timely selection of cotton and submission of approval reports to the Federation's concerned authority.
16. The broker is expected to make efforts to fulfill the contract satisfactorily in the stipulated time. In case the contract is not fulfilled and Federation incurs losses in resale, then it will be binding upon broker to cooperate in recovering such losses. Under the circumstances, broker shall make every effort to recover the losses from buyer.
17. The Registration part (A) is for new brokers seeking for registration. Part (B) of procedure and Part (C) of responsibilities are for all brokers who are already registered as well as who are seeking registration.
12) General :
The Federation is circulating the price list of cotton as and when the prices are revised. These prices are nominal quotation and are subject to change without notice.
(For details please refer prevailing price list ).
13
) Grievance cell :
As a part of our efforts to give more service to our esteemed Patrons, a Grievance Cell has been opened at Sales Office, Khetan Bhavan,. This cell is functions under the direct control of General Manager (S&S) and will deal with all sorts of complaints.
Annexure
- I
OFFER FORM
| |
Mills |
Broker (If any) |
Muccadam (If any) |
|
Fed.Code No. | | | |
|
Name | | | |
|
Address | | | |
|
| | | |
|
Tel.No. | | | |
|
Telex No. | | | |
|
Fax No. | | | |
To,
The General Manager (S&S),
The M.S.C.C.G.M.F.Ltd.,
6th Floor, Khetan Bhavan,
198 J.T.Road, Churchgate, Mumbai.400 020.
Dear Sir,
Sub : Offer for the purchase
of F.P.cotton bales.
I/We hereby give an offer to purchase F.P.Cotton bales of Season ______________ as per the following details. I/We confirm having read and accepted the standard terms & conditions printed overleaf.
This offer is valid upto _____________________a.m./p.m. on_______________.
| Sr.No. |
Variety |
Grade |
Lot No.* |
Station* |
No.of bales. |
Rate (P.C) |
|
| | | | | | |
*Applicable only in case of actual lot offer.
Any other terms which are not in accordance with the standard terms of the Federation.
Place :
Date :
Time :
Office
seal
Mode of receipt of Offer :__________________________________ Date ____________
Offer Registration No. :__________________________________ Date ____________
Placed before SPC dated :__________________________________
Decision of SPC : _______________________________________________________
Contract No. : __________________________________
Dealing
Clerk.
Manager (SS)
Comp1.office2