Warehouse License

What is Warehouse License?

Warehouses are buildings for the storage of goods and commodities. They can be defined as large plain buildings located in the industrial parks in cities, towns, or villages. The stored goods consist of raw materials, spare parts, packing materials, finished goods, and commodities associated with agriculture and other various industries.

The warehouses are managed and regulated by the Warehousing Development and Regulatory Authority (WDRA) of India. According to the Warehousing (Development and Regulation) Act, 2007, and the warehousing (Development and Regulation) Registration of Warehouse rules, 2017, a person starting or carrying warehousing businesses has to get the warehouse to be registered with WDRA. The person who wishes to issue Negotiable Warehouse Receipts (NWRs) also need warehouse registration.

For the registration of warehouses, the applicant must be a citizen of India or an entity registered in India as per the existing laws. The applicant must comply with the terms and conditions as specified by the Principal Commissioner of Customs or Commissioner of Customs.

The license provided for the warehouses is valid unless it is canceled under the provisions of section 58B. A license can surrender the license by requesting to the Principal Commissioner of Customs or Commissioner of Customs. The licenses provided to the public warehouses and special warehouses are not transferrable.

Warehouse Registration Fees

The registration fee for a warehouse of capacity 10,000 tons or less is Rs.20,000. A warehouse with a capacity of more than 10,000 tons, but less than or equal to 25,000 tons requires a registration fee of Rs.25,000. The registration fee for a warehouse of the capacity more than 25,000 tons is Rs.30,000. If the applicant or warehouseman is a farmer producer organization or a cooperative, then the fee of registration is Rs.5000 per the warehouse. The application fee for the registration and renewal of the license is non-refundable

Types of Warehouses

Private Warehouses

Private warehouses are owned and managed by manufacturers, traders, and resellers for their distribution activities. Goods are privately stored in these warehouses. Private warehouses are also called as proprietary warehouses. The warehouses are built near the manufacturing sites. The warehouses by farmers or other producers near their field, those by wholesalers and retailers, those by manufacturers near their production units, those warehouses taken on rent by retail stores, etc. are examples of private warehouses.

Public Warehouses

The warehouses that are owned by the government and semi-government bodies and that are available to the private organizations are called public warehouses. These are helpful for companies with short term warehousing needs. The wholesalers and retailers can take the rent space to store overflow goods for a short duration of time

Bonded Warehouses

Bonded warehouses are managed, controlled, and possessed by the government as well as non-government agencies. The imported goods can be stored in such warehouses without paying duties for a fixed amount of time. The goods are released only after the collection of import duties and other charges. The bonded warehouses operated by non-government agencies need a license from the government. Bonded warehouses are subjected to excise and customs duties. Bonded warehouses reduce the financial burden on the business for a period

Co-operative Warehouses

The warehouses controlled by co-operative societies are called co-operative warehouses. The facilities of these warehouses are provided to the members of respective co-operative societies. The major intention of these warehouses is to help the members

Cross-Dock Warehouses

These warehouses carry out the transfer of goods from an inbound carrier to an outbound carrier. The goods once arrived directly go to the sorting process instead of getting stored.

Temperature Controlled Warehouses

Temperature controlled warehouses have the facilities to maintain the temperature within a range to maintain the quality of commodities. They possess heating and cooling units to be used upon the requirements. They maintain the characteristics of sensitive products.

Climate Controlled Warehouses

Climate controlled warehouses maintain the airflow, temperature, and humidity levels to maintain the quality of commodities. They are equipped with high-quality HVAC systems, dehumidifiers, etc. They maintain the characteristics of sensitive goods and commodities.

Hazardous Material Warehouses

These warehouses store and preserve hazardous materials such as chemicals, explosives, gases, toxic, and radioactive substances. These are located far away from densely populated areas to avoid the risk to the public and environment

Automated Warehouses

Automated warehouses consist of modern equipment using tracking software to receive store and move goods. They are fast and highly efficient. These warehouses have fewer incidences of human error.

What are the documents required for Warehouse Registration?

  • Application in the prescribed form affixing the photograph of the individual or authorized representative.
  • Identity proof of the applicant as per the fifth schedule of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017.
  • Standard operating procedures.
  • Document in support of net-worth as required under rule 18 (5) of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017.
  • Copy of insurance policies as prescribed under rule 17 of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017.
  • Layout plan of the warehouse.
  • Basic data sheet in case of a cold storage warehouse.
  • Proof about technical standards under which warehouse (cold storage) is constructed.
  • List of equipment for assaying goods available at the warehouse.
  • List of equipment for weighing goods available at the warehouse.
  • Fire safety arrangements at the warehouse.
  • If the warehouse is owned, copy of the records of rights or registered title deed in respect to the land on which the warehouse concerned is located as per the 6th schedule of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017.
  • Documents to demonstrate effective control over the warehouse as per the first schedule of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017. These include lease deed or rent agreement, sublease agreement and lease deed indicating that subleasing is permitted, revenue sharing agreement, NOC from Municipal Corporation/ panchayat/ local body, lease agreement from concerned APMC, and copy of allotment letter from the State Government for each warehouse listed in the application separately.
  • DD or banker’s cheque or copy of bank transaction slip in support of payment of registration fee.
  • Existing or previous registration certificate in case of renewal.

What is the procedure for Warehouse Registration?

  • Register on the website. Then the application is sent to the authority.
  • Sign in and submit the application form.
  • Pay the registration fee.
  • Upload the necessary documents.

What if you violate the law?

  • A warehouseman who intentionally issues a negotiable warehouse receipt by neglecting the required conditions will be liable to punishment with imprisonment for a term which may extend to 3 years or with a fine which may extend to four times the value of the goods or with both.
  • The person who intentionally issues a duplicate negotiable warehouse receipt without following the required procedure will be liable to punishment with imprisonment for a term which may extend to 3 years or with a fine which may extend to one lakh rupees or with both.
  • The person who delivers the goods without obtaining the possession of a negotiable warehouse receipt to cause unlawful loss or gain to any person will be liable to punishment with imprisonment for a term which may extend to 3 years or with a fine which may extend to one lakh rupees or with both.

Conclusion

According to the Warehousing (Development and Regulation) Act, 2007, and the warehousing (Development and Regulation) Registration of Warehouse rules, 2017, the persons starting or carrying warehousing businesses have to get the warehouse to be registered with WDRA. It is required for them to strictly follow the rules and regulations under the act. Failing to comply with these may lead to punishable offenses under the act.

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