The Central Board of Indirect Taxes and Customs ( CBIC ) on 16th December, 2024 through notification No. 86/2024-Customs specified the manufacturing processes and other operations in relation to a class of goods that shall not be permitted in a warehouse.
As per the notification goods imported for solar power generation projects which supply electricity are not permitted in a warehouse. It was held that the restriction is applicable only when electricity is resulting from the manufacturing processes and other operations in relation to the warehoused goods under section 65 of Customs Act 1962 (52 of 1962). The notification shall come into force with effect from the 17th December, 2024.
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The Manufacturing and Other Operations in Warehouse (MOOWR) scheme allows manufacturers to import raw materials and capital goods without paying duty. This scheme was introduced by the Central Board of Indirect Taxes and Customs (CBIC) in 1996 and revamped in 2019.
Under these schemes, the goods can be imported without paying duty, with no interest liability. This will allow the clear procedures and digitalise the account keeping.
A single application-cum-approval form was introduced through this scheme. There is no geographical limitations as the units can be set up anywhere. Quick approval is available under this scheme as the approval is given after antecedent verification, one-time site verification, and execution of a bond with insurance policy.
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As per the notification, the statutory scheme underlying the Manufacture and Other Operations in Warehouse Regulations, 2019 (MOOWR) could not be construed as seeking to exclude solar power generation in terms of permissions granted under Section 65 of the Customs Act, 1962.
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