MOOWR Scheme Consultants

Unveil the advantages of the Manufacture and Other Operations in Warehouse Regulations (MOOWR) Scheme with our expert guidance. As your MOOWR scheme consultant expert, we help defer customs duty on imported materials for your manufacturing unit, streamlining your production costs until your goods hit the market.

There are various benefits for businesses to apply for a license under the MOOWR Scheme such as license once obtained is valid for permanence unless cancelled and there are no hassles of periodic renewals.

For more details and queries on MOOWR scheme please read our detailed blog.

Start Now

(i) A person who has been granted a

licence for a private warehouse under Section 58 of the Customs Act, 1962 in accordance with Private Warehouse Licensing Regulations, 2016; and

(ii) A person can also make a combined application for licence for

a warehouse under Section 58, along with permission for undertaking manufacturing or other operations in the warehouse under Section 65 of the Act. The application must be filed to the commissioner of customs.

What are the MOOWR Scheme eligibility criteria?

Application under MOOWR Scheme is to be submitted in Annexure A to the Customs Circular No. 34/2019

dated 01.10.2019.

What is the MOOWR Scheme application process?

The Finance Act, 2023 has brought about significant changes to the Customs Act, 1962 particularly through amendments to Section 65(1) and the introduction of a new provision, Section 65A. However, a date from which the amendment will be effective has not been notified by the government.
These amendments outline that duties such as the IGST and Compensation Cess must be paid upfront on goods stored in a warehouse for manufacturing and other operations irrespective of the goods being exported or sold domestically. Only basic custom duties will be exempted on goods that are eventually exported. However, it is important to note that basic customs duty and other duties will remain exempted for goods already stored in a warehouse.

What is the recent amendment to the MOOWR scheme?

Duty on Import of Raw Material used in Manufacturing or other operations is deferred Until their clearance of Finished Goods;
Deferred duties will be waived in case Finished goods is exported;
For home consumption, Customs Duty and IGST needs to be paid at the time of removal from the factory i.e. bonded area – Deferral in payment of duty;
No need to maintain positive NFE (Net Foreign Exchange Earnings);
License once obtained is valid for permanence unless cancelled. No hassles of periodic renewals;
In case of manufacturing, no interest implication and the imported inputs / capital goods can remain in the warehouse without any time limit – Working capital savings;
Transfer of goods from Bonded Facility to another bonded facility without payment of Duty;
No Limit on the share of Clearance of goods for the Domestic Market. An Entity may manufacture in Bonded Warehouse and sell 100% in Domestic Market.

What are the benefits of the MOOWR Scheme?

Frequently Asked Questions (FAQs) for MOOWR Scheme

What are the MOOWR Scheme eligibility criteria?

(i) A person who has been granted a

license for a private warehouse under Section 58 of the Customs Act, 1962 in accordance with Private Warehouse Licensing Regulations, 2016; and

(ii) A person can also make a combined application for license for a warehouse under Section 58, along with permission for undertaking manufacturing or other operations in the warehouse under Section 65 of the Act. The application must be filed to the commissioner of customs.

What is the MOOWR Scheme application process?

Application under MOOWR Scheme is to be submitted in Annexure A to the Customs Circular No. 34/2019 (Dated 01.10.2019)

What is the recent amendment to the MOOWR scheme?

The Finance Act, 2023 has brought about significant changes to the Customs Act, 1962 particularly through amendments to Section 65(1) and the introduction of a new provision, Section 65A. However, a date from which the amendment will be effective has not been notified by the government.
These amendments outline that duties such as the IGST and Compensation Cess must be paid upfront on goods stored in a warehouse for manufacturing and other operations irrespective of the goods being exported or sold domestically. Only basic custom duties will be exempted on goods that are eventually exported. However, it is important to note that basic customs duty and other duties will remain exempted for goods already stored in a warehouse.

What are the benefits of the MOOWR Scheme?

Duty on Import of Raw Material used in Manufacturing or other operations is deferred Until their clearance of Finished Goods;
Deferred duties will be waived in case Finished goods is exported;
For home consumption, Customs Duty and IGST needs to be paid at the time of removal from the factory i.e. bonded area – Deferral in payment of duty;
No need to maintain positive NFE (Net Foreign Exchange Earnings);
License once obtained is valid for permanence unless cancelled. No hassles of periodic renewals;
In case of manufacturing, no interest implication and the imported inputs / capital goods can remain in the warehouse without any time limit – Working capital savings;
Transfer of goods from Bonded Facility to another bonded facility without payment of Duty;
No Limit on the share of Clearance of goods for the Domestic Market. An Entity may manufacture in Bonded Warehouse and sell 100% in Domestic Market.

Is permission required from Customs for movement of goods between warehouses?

Yes. As per Sections 60 and 67 of the Customs Act, 1962, prior permission is required from the jurisdictional customs officer for

Removal of goods from a port of import to a bonded warehouse

Transfer of goods from one warehouse to another

Can both MOOWR and IGCR benefits be availed simultaneously?

Yes, simultaneous benefit of exemption requiring compliance with IGCR 2022 along with duty deferment under MOOWR can be availed subject to compliances and conditions as prescribed in the IGCR 2022, including the notification in terms of timelines.

What is the difference between MOOWR and IGCR Schemes?

Aspect

MOOWR Scheme

IGCR 2022 Scheme

Duty Payment

Deferred till clearance for home consumption

Concessional/Nil duty at the time of import

IGST

Deferred

Payable

Bonded Warehouse

Mandatory

Not required

Conditions

Compliances under MOOWR

Usage and end-use conditions as notified

Is a bank guarantee required under MOOWR?

No. Instead, a Triple Duty Bond is executed after grant of the MOOWR license.

What is the treatment of capital goods imported under MOOWR?

Capital goods can be:

Exported after use
Cleared in the domestic market (with applicable duties)
Destroyed or relinquished under Section 23 of the Customs Act

How can capital goods be destroyed under MOOWR?

With prior permission from customs, capital goods can be destroyed within the bonded premises. If valid reasons are provided, duty remission can be sought under Section 23(1) of the Customs Act, 1962.

Are second-hand goods allowed under MOOWR?

Yes. Second-hand goods are permitted and treated at par with new goods.

Can one MOOWR license cover multiple warehouses?

No. Each distinct unit/address requires a separate license. However, if multiple units are adjacent and share boundaries, a consolidated application may be considered.

Is trading permitted under MOOWR?

Yes. Goods imported under MOOWR can be traded domestically or exported.

Can goods be retained after their useful life?

Yes. There is no time limit for retention. Duty is payable only when goods are cleared for home consumption.

Can service providers apply under MOOWR?

Yes, provided they operate from a bonded premises and fulfill all regulatory requirements.

What are the compliance obligations under MOOWR?

License holders must:

File monthly consolidated reports on goods received, processed, and removed
Maintain digital and physical records (e.g., Bills of Entry, Shipping Bills, Transport Docs, Transfer Forms)
Preserve records for 5 years
Ensure digital backups to prevent data loss

Are security facilities mandatory before inspection of the unit?

Yes. The following must be installed:

Fire alarm system
Burglar alarm system
Security guard arrangements
CCTV cameras with recording capability

Can MOOWR license be granted for open land with defined boundaries?

Yes. Fully enclosed structures are not mandatory. However, the premises must:

Have secure storage capabilities
Be properly demarcated
Be equipped for compliance

Final discretion lies with the Principal Commissioner/Commissioner of Customs.

What preliminary documents are required for MOOWR application?

Duly filled MOOWR application form
Certificate of Incorporation & Company documents
ID proofs of directors
Premises ground plan
Bank Solvency Certificate
Declaration under Customs Act
Triple Duty Bond
Insurance in favor of Customs (for duty saved amount)

Are digital records mandatory?

Yes. Records must be digitally maintained and retained for at least 5 years.

Is the Triple Duty Bond executed before or after license grant?

The format is submitted before license application. Execution happens after grant of license.

Is job work or third-party processing allowed?

Yes. Goods may be sent for job work, provided:

Goods return to the licensed premises
Complete records are maintained in prescribed forms

Which Bill of Entry is filed for home clearance?

An Ex-Bond Bill of Entry is filed when goods are cleared from the bonded warehouse for domestic use.

Can a company operate multiple MOOWR units under one registration?

No. Each separate address/unit requires its own MOOWR license.

Is the MOOWR application process online or offline?

It is both:

Online via ICEGATE portal
Physical submission to the jurisdictional Customs office

Can domestic procurement be done under MOOWR?

Yes, with GST paid on such procurements. ITC may be claimed as applicable.

Is depreciation available on capital goods under MOOWR?

No depreciation benefit is allowed at the time of clearance of capital goods for home consumption.

To whom should the insurance be addressed, and for what value?

Addressee: The Commissioner of Customs, President of India
Value: Equivalent to the duty saved amount

What is the treatment of waste and scrap?

Waste/scrap generated may be:

Cleared in the domestic market (with applicable duty)
Exported
Destroyed with Customs’ permission

How is the value of the Triple Duty Bond calculated?

Bond value = 3 times the duty saved of proposed imports

Can more items or HS Codes be added post-license?

Yes. A request must be submitted to the jurisdictional Customs office for license amendment.

Is site readiness essential before application submission?

Yes. The site must have:

Defined boundaries
Installed fire safety and surveillance systems
Basic infrastructure to commence operations

What should be the value of the solvency certificate?

The certificate must cover the total duty saved value.

Can a solvency certificate be issued by a Chartered Accountant?

No. It must be obtained from a scheduled commercial bank.

Can finished goods manufactured under the MOOWR Scheme be transferred to another MOOWR-licensed unit without payment of duty and IGST? What is the prescribed procedure and documentation?

Yes, finished goods manufactured under the MOOWR Scheme can be transferred to another MOOWR-licensed unit without payment of customs duty or IGST. In such cases, the liability to pay deferred customs duty is also transferred to the receiving MOOWR unit. The procedure is governed by the Manufacture and Other Operations in Warehouse (No. 2) Regulations, 2019.

Reach out to us.

Sign up to our newsletter

Get regular updates on schemes directly to your email!