Metals and energy are usually cash settled, other than gold and silver. There is no question of bad delivery in case of such cash settled contracts.
But yeah, bad delivery can happen in case someone is trading commodities that have physical delivery, and in such case the exchange charges a penalty @5% of DDR (due date rate, price of the commodity on the day it is marked for delivery). 90% of the penalty collected shall be passed on to the counter party while 10% will be appropriated by the Exchange.
Check this link for physical delivery on MCX