In a filing to the BSE, commodity exchange MCX said: "We wish to inform that FMC has conveyed that the proposal of the company for the appointment of Balasubramaniam Venkataramani as MD & CEO cannot be agreed to."
When contacted, a senior official at Forward Markets Commission (FMC) said that "the appointment proposal has been rejected as MCX did not follow the procedure specified in the guidelines issued last year with regard to appointment of CEO".
As per the revised norms, the exchanges should constitute a selection committee for appointment of MD and CEO. The new MD should be selected through open advertisement.
The exchanges should submit an undertaking that the necessary due diligence has been carried out by them with respect to the verification of antecedents, credentials and experience of the proposed person.
The proposal seeking approval of the FMC for the appointment/termination of services of MD and CEO should be submitted only with the prior approval of the Board of Directors of the Exchange.
At the time of seeking FMC approval for the appointment of MD and CEO, the exchange should also seek approval for the remuneration and terms and conditions from the commission.
In February this year, MCX's board had decided to appoint Venkataramani as MD & CEO.
MCX has been without a Managing Director since May 2014, when Manoj Vaish left. After Vaish's exit, P K Singhal was promoted as joint managing director.