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Central Excise Rules - CHAPTER VII - Warehousing
January, 10th 2011
CHAPTER VII

 WAREHOUSING
 General

139. Warehousing provisions to apply only to goods specially notified in the Official Gazette.-  The provisions of this Chapter shall apply only to excisable goods to which they are extended by the Central Government by notification in the Official Gazette, and the piovisions relating to the removal from one warehouse to another shall not apply to such goods:

        Provided that the Central Government may by notification in the Official Gazette direct that the provisions relating to the removal from one warehouse to another shall extend to such goods subject to such limitations and conditions as may be specified therein.

140. Appointment and registration of warehouses.- (1) The Commissioner shall, by order in writing, from time to time, approve and appoint public warehouses and may in like manner register private warehouses for the storage of excisable goods on which duty has not been paid, and may direct in what parts or divisions of such warehouses, and in what manner and on what terms, such goods may be stored and how and in what manner such warehouses, or parts or divisions thereof, shall be secured by locks, fastenings or otherwise. The Commissioner may revoke his approval of a warehouse; and upon such revocation all goods warehoused therein must be removed as the Commissioner directs, and no abatement of duty or allowance shall be made in respect of any such goods for deficiency of quantity, strength or quality after notice of the revocation has been given to the proprietor or occupier of the warehouse.

(2) If the Central Government is satisfied that it is necessary or expedient so to do in the public interest, it may, by a general or special order, declare any premises or group of premises to be a refinery, either permanently or for a specified period, and on such declaration, such refinery shall be deemed to be a warehouse appointed or registered under sub-rule (1) and the provisions of this Chapter shall apply in relation to the goods processed or manufactured in such refinery as they apply in relation to the goods stored in a warehouse appointed or registered under sub-rule (1).
Form:D.D.2

141. Receipt of goods at warehouse.-  All goods brought for warehousing shall be produced to the officer-in-charge of the warehouse together with the relative transport permit or certificate and shall be weighed, measured or gauged in his presence, and assessed to duty prior to entry into the warehouse; and the quantity and description of the goods, the marks and numbers of the packages, the number and date of the permit or certificate and the amount of duty leviable thereon shall be noted in the warehouse register. All goods received into a warehouse shall be kept separate from other goods until the receipt account has been taken by the officer.

142. Omitted

143. Owner's power to deal with warehoused goods.- With the sanction of the proper officer and in accordance with such instructions as the Commissioner may, from time to time, issue in writing in this behalf, any owner of goods lodged in a warehouse may sort, separate, pack and repack the goods and make such alterations therein as may be necessary for the preservation, sale or disposal thereof. After the goods have been so separated and repacked in such manner as may be ordered by the Commissioner, the proper officer may, at the owner's request, cause or permit any refuse or damaged goods remaining after such repacking to be destroyed subject to such limitations as the Commissioner may from time to time impose, and may remit the duty assessed thereon.

143A. Special provisions with respect to goods processed and manufactured in refineries.-  With the sanction of the proper officer and in accordance with such instructions as the Commissioner may, from time to time, issue in writing in this behalf, the owner of the goods processed or manufactured in a refinery, declared under sub-rule (2) of rule 140, may blend or treat or make such alterations or conduct such further manufacturing processes in the aforesaid goods in such manner and subject to such conditions as the Central Government may, by notification in the Official Gazette, specify.

144. Goods not to be taken out of warehouse except as provided by these rules.-  No goods shall be removed from any warehouse except as on payment of duty or, where so permitted by the Central Government by notification in this behalf, for removal to another warehouse or for export, from India and on presentation of the written application prescribed in rule 158 or in rule 185, as the case may be.

Owner of goods may take samples.- Provided that, subject to such conditions and limitations as the Commissioner may impose the owner may remove samples sufficient to enable him to conduct his business. Such samples shall be duly ticketed and certified by an officer and shall be entered in the warehouse register and included in the total quantity of such goods liable to duty when an account of the stock in the warehouse is taken as prescribed in rule 223A and duty shall be levied thereon when such account is taken and not at the time of removal of the samples from the warehouse.
Form:D.D.2

145. Period for which goods may remain warehoused .-  Any goods warehoused may be left in the warehouse in which they are deposited, or in any warehouse to which such goods may, in manner hereinafter provided, be removed, till the expiry of  three years, from the date on which such goods were first warehoused. The owner of any such goods remaining in a warehouse on the expiry of such period shall clear the same either for home consumption after payment of duty in the manner provided in rule 157, or for exportation in bond in the manner laid down in rule 13 or rule 14:
Provided that in the case of tobacco this rule shall have effect as if for the words "three years" the words "two years" were substituted:

Provided further that if the goods (other than tobacco) have not deteriorated and the Commissioner on sufficient cause being shown is satisfied about the condition of the goods and the genuineness of the reasons advanced for claiming extension, he may

(a) permit such goods to remain in any warehouse for a further period not exceeding one year, in extension of the period of three years referred to in this rule;

(b) permit such goods to remain warehoused in such warehouse for a further period not exceeding one year in addition to the extension granted under clause (a) of this proviso:

Provided also that in the case of tobacco if the goods have not deteriorated and on sufficient cause being shown, the Commissioner may, if he is satisfied about the condition of the goods and the genuineness of the reasons advanced for claiming extension,
(a) permit such goods to remain in any warehouse for a further period not exceeding one year, beyond the period of two years referred to in this rule;

(b) in the case of flue-cured tobacco, permit such goods to remain warehoused in such warehouse for such further period as may be specified by him in addition to the extension granted under clause (a) of this proviso:

Provided further that if the said period of three years or two years, as the case may be, or such extended period as may have been allowed under the aforesaid provisos to this rule expires at any time during which the Central Government have imposed quantitative restrictions on the clearance of excisable goods from a warehouse for home consumption, the restrictions on removal of goods laid down in sub-rule (3) of rule 224 shall apply to the clearance of such goods in the same manner and to the same extent as they apply to all other goods in the warehouse, and any quantity of such goods remaining uncleared at the end of the period of restriction shall be cleared on the day immediately following the date of expiry of such period and where any such goods are not likely to deteriorate the Central Board of Excise and Customs may, on application, permit the goods to remain for such extended period as it may specify if it is satisfied that the period allowed by the Commissioner under the aforesaid provisions is inadequate under the circumstances of the case.

145A. Goods in private warehouse to be cleared on cancellation of Registration Certificate.- Notwithstanding anything contained in rule 145, when the Registration Certificate for any private warehouse is cancelled, and the registration authority gives notice of such cancellation to the registered person of such warehouse, the registered person shall in manner hereinafter provided and within fourteen days from the date on which such notice is given or such extended time as the registration authority may in his discretion allow, remove such goods to a public warehouse, or sell them to the registered person of another private warehouse, or clear them for home consumption after payment of duty in the manner provided in rule 157, or export them in bond as provided in rule 13 or rule 14.

146. Mode of calculating quantity of goods warehoused.- The quantity of goods contained in any package warehoused may be calculated by weight, measure, gauge, or in such other manner as the Central Board of Excise and Customs may direct.

147. Power to remit duty on warehoused goods lost or destroyed.- If any goods lodged in a warehouse are lost or destroyed by unavoidable accident, the Commissioner may in his discretion remit the duty due thereon:

Provided that if any goods be so lost or destroyed in a private warehouse, notice thereof shall be given to the officer-in-charge of the warehouse within forty-eight hours after the discovery of such loss or destruction.

148. Responsibility of warehouse-keeper.-  The warehouse-keeper in respect of goods lodged in a public warehouse, and the registered person of the warehouse, in respect of goods lodged in a private warehouse, shall be responsible for their due reception thereon and delivery therefrom and for their safe custody while deposited therein, according to the quantity or weight reported by the officer who has assessed the goods, allowance being made, if necessary, for wastage and losses as provided in rule 223A.

Compensation for loss or damage.-  Provided that no owner of goods shall be entitled to claim from the Commissioner, or from any keeper of a public warehouse, compensation for any loss or damage occurring to the goods while they are being passed into or out of such warehouse, unless it is proved that such loss or damage was occasioned by the wilful act or neglect of the warehouse-keeper or of an officer.

149. Destruction of unusable material, waste and other refuse.- Every owner of the goods stored in a warehouse who wishes to claim immunity from duty in respect of any goods unfit for consumption or manufacture shall destroy them in the presence of an officer or shall show to the satisfaction of the officer that they are being applied to some purpose which render them eligible for remission of duty.

150. Excisable goods may be lodged in Customs bonded warehouse under certain conditions.- (1) Subject to such terms, conditions and limitations as the Central Board of Excise and Customs may, from time to time, make in this behalf, excisable goods of any description may be warehoused in any Customs warehouse approved by the Commissioner for the purpose.

(2) All the powers, provisions and penalties, contained in or imposed by these rules, as to warehousing, custody and delivery out of warehouse of excisable goods, and as to any deficiencies therein or allowance thereon, shall, where applicable, be observed, applied, enforced and put into execution with reference to such goods warehoused in Customs warehouses.

151. Omitted.

152. Goods may be removed from one warehouse to another.- (1) Subject to the limitation imposed by rule 139, any goods warehoused under these rules may at any time within the period during which such goods can be left, or are permitted to remain in a warehouse under rule 145, may be removed from one warehouse to another subject to the observance of the procedure hereinafter prescribed.

(2) For the purpose of such procedure

(a) "consignor" shall be deemed to be
(i) if the goods are to be removed from a public warehouse, the owner of such goods;

(ii) if the goods are to be removed from a private warehouse, the Registered person of such warehouse;

(b) "consignee" shall be deemed to be
(i) if the goods are to be removed to a public warehouse, the owner of such goods;

(ii) if the goods are to be removed to a private warehouse, the Registered person of such warehouse.

153. to 155. Omitted

156. Certificate regarding consignee to be produced.- Along with his application for the removal of the goods, the consignor shall produce before the proper officer a certificate in the proper Form stating the particulars of the Central Excise licences held by the consignee.
Form:C.T.1

156A. Procedure in respect of goods removed from one warehouse to another.- (1) The application for removal of goods from one warehouse to another shall be presented by the consignor in triplicate, and in the proper Form, to the officer-in-charge of the warehouse of removal, at least 24 hours before the intended removal, together with such other information as the Commissioner may by general or special order require.

(2) Such officer shall then take account of the goods, and after completing the removal certificate on all the copies of the application, shall send the duplicate to the officer-in-charge of the warehouse of destination, and hand over the triplicate to the consignor for despatch to the consignee. He shall also deliver to the consignor a transport permit in the proper Form.

(3) On arrival of the goods at the warehouse of destination, the consignee shall present them together with the triplicate application
and the transport permit to the officer-in-charge of such warehouse, who shall, after taking account of the goods, complete the rewarehous-ing certificate on the duplicate and the triplicate application, return the duplicate to the officer-in-charge of the warehouse of removal, and triplicate to the consignee for despatch to the consignor.

(4) The consignor shall present the triplicate application duly endorsed with such certificate to the officer-in-charge of the warehouse of removal within ninety days of the date of issue of the transport permit under sub-rule (2).
Form:A.R.3
Form:T.P.2

156B. Failure to present triplicate application.- (1) If the consignor fails to present the triplicate application to the officer-in-charge of the warehouse of removal in the manner laid down in sub-rule (4) of rule 156A, and the duplicate application endorsed with the rewarehousing certificate has also not been received by such officer from the officer-in-charge of the warehouse of destination, the consignor shall, upon a written demand being made by the former officer, pay the duty leviable on such goods within ten days of the notice of demand and if the duty is not so paid he shall not be permitted to make fresh removals of any warehoused goods from one warehouse to another until the duty is paid or until the triplicate application is so presented or the duplicate application is so received.

(2) Where such duty has been paid, it shall be refunded to the consignor either on his presentation of the triplicate application to or on the receipt of the duplicate application by the officer at the warehouse of removal, duly endorsed, as provided in sub-rule (3) of rule 156A, with a certificate by the officer-in-charge of the warehouse of destination that the goods covered by the application have been satisfactorily rewarehoused.
Form:D.D.2

Removal of goods from a warehouse

157. Clearance of goods for home consumption.-  Any owner of goods warehoused may, at any time within the period during which such goods can be left or are permitted to remain in a warehouse under rule 145 clear the goods for home consumption by paying

(a) the duty thereon assessed prior to entry or re-assessed under rule 159; and

(b) all rent, penalties, interest and other charges payable in respect of such goods.

The goods shall then be assessed and cleared in the manner described in rule 52.

158. Form of application for clearance of goods.-  Applications to clear goods from a warehouse on payment of duty or for transfer to another warehouse or for export from India shall be in the proper Form, or in such modified reproduction of such Form as the Commissioner may in any particular case allow, and shall be delivered to the officer-in-charge of the warehouse at least twenty-four hours before it is intended to remove the goods.
Form:A.R.1
Form:A.R.3
Form:A.R.4

159. Re-assessment.-
(1) If, after any goods are entered for warehousing

(a) any alteration is made in the rate of duty leviable thereon, or in the tariff valuation (if any) applicable thereto, or

(b) the goods are sorted, separated, crushed, or subjected to any other process which causes the goods or any part thereof to become liable to duty at a rate other than that at which they were assessed on entry into the warehouse, the goods shall be re-assessed in accordance with such alteration.

(2) Where the rate of duty leviable upon any goods is determined by the use to which the goods are to be put after clearance from the warehouse, the goods shall be re-assessed to duty at such rate if such rate be different from the rate at which goods were assessed to duty when they were received in the warehouse.

160. If goods are improperly removed from warehouse or allowed to remain beyond time fixed, or lost, or destroyed, Commissioner may demand duty, etc.-  If any goods are removed from the warehouse without permission, or if any goods are not removed from the warehouse within the period during which such goods can be left or are permitted to remain in a warehouse under rule 145, or if any goods are lost or destroyed otherwise than as provided in rules 143,147 or 149, or are not accounted for to the satisfaction of the proper officer, that officer may thereupon demand and the owner of the goods shall forthwith pay, the full amount of duty chargeable thereon, together with all rent, penalties, interest and other charges payable on account of the goods.
Form:D.D.2

161. Procedure on failure to pay duty, etc.- (1) If any owner fails to pay any sum demanded under rule 160, the proper officer shall forthwith cause the goods (if any) in the warehouse or, as the case may be, such portion thereof, on account of which the amount is due, to be detained with a view to the recovery of the demand, and if the demand be not discharged within ten days from the date of such detention due notice thereof being given to the owner (if his address be known) the goods so detained may be sold by public auction duly advertised in the Official Gazette, or in such other manner as the Central Board of Excise and Customs may in any particular case direct.

(2) The sum demanded under rule 160 and the expenses (if any) incurred on account of the public auction of the goods shall be defrayed from the proceeds of the sale and the surplus proceeds (if any) shall be paid to the owner of the goods:

Provided that application for the same shall be made within one year from the sale, or that sufficient cause be shown for not making the application within that period.

162. Noting removal of goods.-  When any goods are taken out of any warehouse, the proper officer shall cause the fact to be noted in the warehouse register.

(2) Every note so made shall specify the quantity and description of the goods, the marks and numbers of the packages, the name of the person removing them, the number and date of the application for clearance and the amount of duty paid (if any).

162A. Omitted

Public Warehouses

163. Warrant to be given when goods are lodged in a public warehouse.-  The owner of goods, which are to be deposited in a public warehouse shall, after they have been duly assessed to duty as provided in rule 141, deliver the goods to the keeper of the warehouse and the latter shall, after comparing the packages with the description entered in the warehouse register, grant him a warrant in the proper Form.
Form:W1

164. Owner of goods to pay such dues when demanded.- The owner of goods, who has deposited the goods in a public warehouse, shall,

(a) pay, on demand, all duties, rent and charges claimable on account of such goods under the Act or these rules, together with interest on the same from the date of demand, at such rate not exceeding six per cent per annum as may for the time being be fixed by the Central Board of Excise and Customs;

(b) discharge all penalties imposed for contravention of the provisions of the Act or these rules in respect of such goods.
Form:D.D.2

165. Access of owner to warehoused goods.- (1) Any owner of goods lodged in a public warehouse shall, at any time within the hours of business, have access to his goods in the presence of an officer and an officer shall, upon application for the purpose being made in writing to the proper officer be deputed to accompany such owner.

(2) When an officer is specially employed to accompany such owner a sum sufficient to meet the expense thereby incurred shall, if the Commissioner so require, be paid by such owner to the proper officer, and such sum shall, if the Commissioner so directs, be paid in advance.

166. Keeper of public warehouse solely responsible for safety of goods stored therein.-  The keeper of a public warehouse shall be alone responsible to the proprietor of any goods warehoused therein for the safety of the goods.

167. Payment of rent and warehouse dues.-

(1) The owner of goods lodged in a public warehouse shall pay monthly, on receiving a bill or written demand for the same from the proper officer, rent and warehouse dues at such rates as the Commissioner may fix.

(2) A table of rates of rent and warehouse dues so fixed shall be placed in a conspicuous part of the warehouse.

(3) If any bill for rent or warehouse dues presented under this rule is not discharged within ten days from the date of presentation, the proper officer may, in the discharge of such demand, cause to be sold by public auction after due notice in the Official Gazette, or in such other manner as the Central Board of Excise and Customs may in any particular case direct, such sufficient portion of the goods as he may select.

(4) Out of the net proceeds of such sale, the proper officer shall first satisfy the demand for the discharge of which the sale was ordered and shall then pay over the surplus (if any) to the owner of the goods:

Provided that application for such surplus be made within one year from the date of sale of the goods or that sufficient cause be shown for not making it within such period.

168. Keeper of public warehouse to keep record of all entries into, operations in, and removals from his warehouse,- The public warehouse-keeper shall maintain proper records of all entries into, operations in, and removals of goods from his warehouse indicating among other particulars, the quantity, value, rate and amount of duty, marks and numbers, as the case may be, in regard to such receipts, manufacture or any other processing as are carried on the goods received including re-packing, storage, and delivery of the goods.

169. Public warehouse to be locked.-  Every public warehouse shall be under the lock and key of a warehouse-keeper appointed by the Commissioner.

170. Expenses of carriage, packing, etc., to be borne by owner.- The expenses of carriage, packing and storage of such goods on their reception into or removal from a public warehouse shall, if paid by the proper officer or the warehouse keeper, be chargeable on the goods and be defrayed by and recoverable from the owner in the manner prescribed in rule 167.

 Private Warehouses

171. Wholesale dealer in excisable goods may receive such goods into a private warehouse without payment of duty.- Notwithstanding the provisions of rule 40, any wholesale dealer in excisable goods who is also the Registered person of an approved warehouse may receive into such warehouse, goods on which duty has not been paid provided that such goods are covered by a valid permit in the proper Form granted by an officer, or by a certificate in the proper Form signed by a registered curer, or by such wholesale dealer or by his broker or commission agent, and are duly assessed to duty as provided in rule 141:

Provided further that such wholesale dealer shall not receive into the warehouse any unmanufactured products which do not belong to him, unless he is also the holder of Registration Certificate granted under these rules to act as a broker or commission agent in respect of such products.

172. Private warehouses to contain only goods belonging to warehouse owner or held by him as a broker or a commission agent and only goods on which duty has not been paid.-  A private warehouse shall be used solely for warehousing excisable goods belonging to the Registered person himself, or held by him as a broker or a commission agent; and the Registered person shall not admit to or retain in the warehouse any goods on which duty had been paid:

Provided that, where the goods are held by a broker or commission agent, he shall be deemed to be the owner of such goods for all the purposes of these rules in so far as they relate to warehousing of goods in a private warehouse.

173. Registered person of private warehouse to keep record of all entries into, operations in, and removals from his warehouse.- Every registered person of a private warehouse shall maintain proper records of all entries into, operations in, and removals of goods from his warehouse indicating among other particular, the quantity, value, rate and amount of duty, marks and numbers, as the case may be, in regard to such receipts, manufacture or any other processing as are carried on the goods received including repacking, storage, and the delivery of the goods.

 
 
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