Mumbai, Feb 7 (PTI) Holding that neither ForwardMarkets Commission (FMC) nor Central Electricity RegulatoryCommission (CERC) had the jurisdiction to deal with thefutures contract independently, the Bombay High Court todayset aside two orders passed by CERC which said it alone couldframe norms regarding power trading.
The ruling was given by a Division Bench of Justices PB Majmudar and Anoop Mohata on a petition filed by FMC, thecommodity market watchdog which challenged the order passedby CERC and also an appeal arising out of it.
The issue cropped up after an application was filed byMulti-commodity Exchange (MCX) before FMC seeking permissionfor forward trading in power. As FMC allowed MCX to trade inpower, an objection was raised by Power Exchange of Indiawhich said CERC alone had jurisdiction to allow such trading.
In their 80-page order, the Judges observed, "in viewof specific provisions in Forward Contracts (Regulation) Act(FCRA), a central legislation enacted earlier in point oftime, by which a notified commodity forward contract can beundertaken only through the machinery under the said Act, thefutures contract in electricity cannot be exclusively dealtwith by the authority under the FCRA."
"Similarly, in view of the specific provisions underFCRA, CERC also cannot deal with the futures contract on itsown and have no power to deal with the same in the futurescontract, unless appropriate enactment has been made by way ofstatutory provision regulating the futures contract givingpowers only to one authority out of the aforesaid twoauthorities," they noted. (More) PTI SVS AP RSY