Company : Sol Infotech Pvt. Ltd. Website : www.courtkutchehry.com MANUFACTURE and OTHER OPERATIONS IN WAREHOUSE REGULATIONS, 1966 CONTENTS 1. Short title and commencement. 2. Definitions. 3. Owner to make applications. 4. Execution of Bond. 5. Grant of sanction. 6 . Conditions that may be imposed by the 5[Assistant Commissioner of Customs]. 7. Plant, machinery, accessories, fixtures etc., must be duty paid. 8. Manufacture to be under supervision of Customs Officers. 9. Maintenance of accounts. 10. Accounts to be accessible to Customs Officer. 11. Control of proper officer over storage premises in warehouse. 12. Issue and return of imported goods to/from the manufacturing process or other operations. 13. Manufacturer to give notice before suspending or ditscontinuing the manufacturing process or other operations. 14. Cancellation and suspension of sanctions. 15. Repeal. SCHEDULE 1 :- SCHEDULE MANUFACTURE and OTHER OPERATIONS IN WAREHOUSE REGULATIONS, 1966 C.B.E. and C. Notification No. 155-Cus., dated 30th July, 1966. In exercise of the powers conferred by section 157 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs hereby makes the following regulations, namely:- 1. Short title and commencement. :- (1) These regulations may be called the Manufacture and Other Operations in Warehouse Regulations, 1966. (2) They shall be deemed to have come into force on the 4th day of June, 1966. 2. Definitions. :- For the purpose of these regulations, unless the context otherwise requires - (i) "Act" means the Customs Act, 1962 (52 of 1962); (ii) "manufacturer" means the owner of any warehoused goods to whom sanction has been accorded under regulation 5; (iii) "proper form" means such form as the 1 [Assistant Commissioner of Customs] may require to be adopted. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 3. Owner to make applications. :- (a) The owner of any goods warehoused under the Act intending to undertake any manufacturing process or other opera- tions in the warehouse in relation to such goods shall make an application to the 1 [Assistant Commissioner of Customs] in the proper form and furnish inter aha - (i) information regarding the nature of the manufacturing process or other operations; (ii) particulars of imported and other goods proposed to be used in the manufacturing process or other operations; (iii) the detailed plan and description of the warehouse; and (iv) data regarding the volume of trade anticipated of the manufacturing process or other operations; and (v) the applicant shall, on being called upon to do so, furnish such other information as may be required. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 4. Execution of Bond. :- The 1[Assistant Commissioner of Customs] may, if he is satisfied that the applicant has carried out such alterations to the warehouse premises as maybe required for this purpose and that the volume of trade and other considerations justify grant of sanction direct the applicant to file a bond, undertak- ing inter alia to - (i) observe all the provisions of these regulations; (ii) maintain detailed accounts of all imported and other goods used in the manufacturing process or other operations in the proper form and to produce such accounts for inspection by the proper officer; (iii) submit detailed statements of all imported and other goods used in the manufacturing process or other operations and those remaining in stock, at any time the proper officer directs; (iv) provide to the officers of customs stationed in the warehouse for control and supervision of the manufacturing process or other operations such amenities as may be specified by the 2[Assistant Commissioner of Customs]; (v) pay all the charges including pay, allowances, leave and pensionary charges of such officers as may from time to time be posted by the 3[Assistant Commissioner of Customs] in the warehouse for supervision and control of the manufacturing process or other operations; and (vi) comply with such conditions as may be imposed by the 1 [Assistant Commissioner of Customs] from time to time for carrying out the purposes of these regulations and the Act. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 2. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 3. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 5. Grant of sanction. :- On execution of the bond, in the manner hereinbefore provided, the 1 [Assistant Commissioner of Customs] shall accord sanction to the applicant to carry on such manufacturing process or other operations specify- ing: (a) the manufacturing process or other operations permitted to be carried on in the warehouse; (b) the types and nature of imported and other goods permitted to be used; (c) the period for which the sanction is valid; and (d) the conditions, if any, subject to which the manufacturing process or other operations may be carried on in the warehouse. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 6. Conditions that may be imposed by the 5[Assistant Commissioner of Customs]. :- The 1 [Assistant Commissioner of Customs] may from time to time : (i) fix the dates or days on which and the hours during which the manufac- turing process or other operations, may be carried on in the warehouse; (ii) determine the number of customs officers that may be attached to the warehouse for purposes of supervising the manufacturing process or other operations; (iii) fix the sum payable by the manufacturer towards the cost of such establishment and the extra charges payable towards the overtime services, if any, performed by such establishment at the request of the manufacturer; and (iv) prescribe the manner in which manufactured goods shall be packed, marked and stored at different stages of the manufacturing process or other operations. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 7. Plant, machinery, accessories, fixtures etc., must be duty paid. :- Plant, machinery, fixtures and accessories necessary for carrying on the manufac- turing process or other operations in the warehouse and consumable stores required for the maintenance thereof must be duty paid. 8. Manufacture to be under supervision of Customs Officers. :- The manufacturer shall carry on the manufacturing process or other operations in the warehouse under such supervision as the 1 [Assistant Commissioner of Customs] may direct. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 9. Maintenance of accounts. :- The manufacturer shall maintain accounts relating to stocks, raw materials, goods in process, finished goods, waste and refuse in proper form: Provided that where the manufacturer maintains for his own purpose such detailed accounts and has carried out such alterations in the form of accounts as may be required in this behalf, the 1 [Assistant Commissioner of Customs] may in his discretion direct such forms of accounts to be adopted as the proper form. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 10. Accounts to be accessible to Customs Officer. :- The proper officer may, at any time, inspect or call for the accounts and connected records for scrutiny. 11. Control of proper officer over storage premises in warehouse. :- All rooms in the warehouse premises, wherein imported goods for use in the manufacturing process or other operations are stored, shall also be locked by the proper officer and the keys kept in his custody. 12. Issue and return of imported goods to/from the manufacturing process or other operations. :- (a) The 1 [Assistant Commissioner of Customs] shall, having regard to the manufacturing process or other operations to be carried on in the warehouse, direct the manner in which the imported goods shall be issued from arid the unused items received back into stock. (b) The application for issue of imported goods and the vouchers against which the unused items may be returned shall be in the proper form. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 13. Manufacturer to give notice before suspending or ditscontinuing the manufacturing process or other operations. :- No manufacturer shall suspend or discontinue the manufacturing process or other operations authorised to be carried on in the warehouse without giving in writing to the 1[Assistant Commissioner of Customs], one month's notice of his intention so to do : Provided that in any particular case the aforesaid period of one month may, on sufficient cause being shown, be reduced by the 2[Assistant Commissioner of Customs] by such period as the 3[Assistant Commissioner] may deem fit: Provided also that where the manufacturer suspends or discontinues the manufacturing process or other operations without any notice, he shall be liable to pay on demand the cost of establishment and other charges for such reasonable period as the 4 [Assistant Commissioner of Customs] may in his discretion determine. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 2. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 3. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 4. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 14. Cancellation and suspension of sanctions. :- If the manufacturer or any person in his employ commits a breach of the provisions of the Act or the terms and conditions imposed by or under these regulations or if the particulars furnished in. the application for sanction are false or incorrect, or if any undertaking given in the bond is not fulfilled the 1 [Assistant Commissioner of Customs] may, without prejudice to any other action that he may take under the provisions of the Act or these regulations cancel the sanction for carrying on the manufacturing process or other operations: Provided that before the sanction is cancelled the manufacturer shall be given reasonable opportunity of being heard. 1. Designation changed vide s. 50 of the Finance Act, 1995 (22 of 1995). 15. Repeal. :- The Rules and Regulations specified in the Schedule to these regulations appended below shall cease to be in force except as respects things done or omitted to be done before such cesser. SCHEDULE 1 SCHEDULE (See Regulation 15) 1.Rules prescribed for the purpose of operation on goods in a warehouse - Wines and Spirits - vide late C.B.R. Notification No. 56, dated the 2nd July, 1927 as amended by Notifications No. 29-Cus., dated 16th May, 1931 and No. ll-Cus., dated the 22nd January, 1938. 2.Rules for the manufacture of cigarettes in bond from unmanufactured foreign tobacco imported and warehoused under the provisions of Section 92 of the Customs Act, 1962 at an inland bonded warehouse - late C.B.R. Notification No. 34-Cus., dated the 30th May, 1942. 3.Rules for the manufacture of cigarettes or tobacco in bond from unmanufactured foreign tobacco imported and warehoused under the provisions of s.92 of the Customs Act, 1962 -late C.B.R Notification No. 54-Customs, dated the 25th October, 1941, as amended by Notifications No. 8-Customs, dated 17th April, 1943 and No. 62-Customs, dated the 8th July, 1950. 4.Rules for manufacture of complete Gramophone machine (including electric gramophones) in bond - late C.B.R. Notification No. 9-Customs, dated the 13th July, 1946. 5.Rules for the free-entry at the Madras Customs House of unmanufactured foreign tobacco imported for the manufacture of cigars intended for export to foreign ports-Notification dated the 1st November, 1910, published in pages 1685-86 of Part II of the Fort St. George Gazette, dated the 8th November, 1910 as amended by notification dated the 22nd May, 1920 published on page 1051 of Part II of the Fort St. George Gazette, dated the 1st June, 1920, late C.B.R. Notification No. 79-Customs, dated the 5th December, 1936, Notification No. 12-Customs, dated the 22nd January, 1938 and No. 47-Customs, dated the 12th October, 1940. 6.Rules to regulate the canning of motor spirit and kerosene oil from the stock imported and warehoused in a bonded tank at Bombay-late C.B.R. Notification No. 5-Customs, dated the 5th January, 1935 as amended by Notification No. 70-Customs, dated the 26th March, 1938. 7.Rules for the manufacture or repairs of vessels from material imported by the Hindustan Shipyard Ltd., Visakhapatnam etc. - late C.B.R. Notification No. 78-Customs, dated the 7th August, 1954 as amended by C.B.R. Notification No. 63- Customs, dated the 3rd June, 1961. 8.Motor Vehicles (Manufacture-in-bond) Rules, 1956 - late C.B.R. Notification No. 97-Customs, dated the 6th November, 1956. 9.Rules for the manufacture or re-manufacture of cigarettes or tobacco in bond from indigenous or imported duty paid tobacco or cigarettes and unmanufactured imported tobacco warehoused under the provision of Section 92 of the Customs Act, 1962 - late C. B. R. Notification No. 22-Customs, dated the 29th June, 1957. 10.The Handicrafts (Manufacture-in-bond) Rules, 1958 - C.B.R. Notification No. 229-Customs, dated the 13th August, 1958. 11.The Manufacture-in-Bond (General) Rules, 1960 - late C.B.R. Notification No. 15-Customs, dated the 27th February, 1960.