Procedure for permission of Private Warehouses:

In case of Private Bonded Warehouses, the applications for such licences have been classified into two categories viz., storage of sensitive goods such as liquor, cigarettes, foodstuffs, consumable, cut and polished gemstones, etc. and other non-sensitive goods. Under Board‟s Circular No.99/95 dated 20.9.1995, the following guidelines in case of storage of sensitive goods have been provided:-

(i) Applicants should produce a Solvency Certificate from a Scheduled Bank of repute for a value not less than ` 50 lakhs;

(ii) Such warehouses may not be located in residential areas;

(iii) The premises should be secure, possess fire-fighting provisions and be easily accessible to the Customs Officers;

(iv) Goods deposited should be fully insured for a value at least equal to the customs duty;

(v) The proprietor/partner/director must not be involved in any Customs or Excise offence. In case of any involvement in such offences, the licence may be terminated after following the prescribed procedure;

(vi) In the case of individual consignments to be warehoused, a double duty-bond as prescribed under section 59 should be given by the licencee. In case of sensitive goods, a cash deposit/ bank guarantee equal to 25% of the duty liability (effective duty foregone) will be taken for each consignment. At the same time, a revolving bond with a single bank guarantee for a higher amount can be accepted if so requested for a number of consignments.

In the case of non-sensitive goods, applicants for Private Bonded Warehouses have to abide by all provisions as pertaining to sensitive goods discussed above, except that the requirement of furnishing a Solvency Certificate has been waived. The applicant, however, should be solvent for ` 10 lakh and should possess a good record. A double duty bond with surety would suffice for storage of non-sensitive bonded goods. In case the Customs are not satisfied about the transactions of a particular bonder, the applicant may be asked to furnish a bank guarantee.