Warehouses – Checklist of Licenses and Registrations

There are numerous licenses and registrations for operating a warehouse. With the new economy of  sharing warehouse space, it becomes essential to ensure compliances of both the operator and the depositor of the goods. Below is a checklist, listing the licenses and registrations to be obtained from the operator and the depositor. Many licenses are very specific to the goods stored.

The Warehousing (Development And Regulation) Act, 2007 defines “warehouse” as any premises (including any protected place) conforming to all the requirements including manpower specified by the Authority by regulations wherein the warehouseman takes custody of the goods deposited by the depositor and includes a place of storage of goods under controlled conditions of temperature and humidity.

Particulars Requirements Warehouse Operator Depositor
Registration VAT Registration/Certificate Yes Yes
Sales Tax Registration Yes  
Excise Registration with Central Excise Department (Manufacture of Dutiable goods) Yes  
Customs Registration Yes  
Registration certificate issued by the Accreditation Agencies registered with National Cooperative Development Corporation (NCDC)) Yes  
PAN Card   Yes
TIN Number (Synonymous with VAT and CST registration) Yes Yes
Profession Tax Certificate (N/A for Delhi)   Yes
CST Certificate (Now synonymous with VAT/TIN registration)   Yes
TAN Certificate   Yes
Import of goods – IEC Number   Yes
Registration Certificate (Shops and Establishments Act) Yes Yes
For Manufacturer

Factory Registrations:

  • SSI (small scale); or
  • MSME (micro-small-medium); and
  • DIC registration.

With local authority:

  • For land location of a production unit, permission from local municipal corporation or other units of the city/district; like BDA or BBMP in Bangalore.
  Yes
Licenses NOC or warehouse license from the Municipal Corporation or local authority Yes Yes
Factory License (for Karnataka issued by Karnataka, Department of Factories, Boilers, Industrial Safety and Health)   Yes
All Vehicle used for transportation to have valid documents (as per Motor Vehicle Act, 1939 Yes Yes
Insurance If the stock is Purchased:

Transportation and Transit Insurance

NOTE: Insurance of imported goods/equipment would need to be arranged on a very selective basis and only for cases where the value of individual shipment is expected to be in excess of Rs. 5 crores.

  Yes
Statutorily required insurances:

  • Inventory and Goods Insurance (Rule 3 (8), Warehouse Regulations, 2011)
  • Fire Insurance (Rule 3 (8), Warehouse Regulations, 2011)
  • Workmen’s Compensation Insurance/ Employees Liability Insurance (Workmen Compensation Act, 1923)
  • Burglary Insurance (Rule 3 (8), Warehouse Regulations, 2011)
Yes Yes
Product liability insurance   Yes
Inland cargo Insurance (Specifically for covering goods that are transported within the country- a form of Marine Insurance) Yes Yes
Truck Cargo Policy   Yes
Stock Throughput Insurance   Yes
Insurance Policies:

  • Special fire perils policy (for a value not less than the actual value of the stocks held in storage at a given point of time and if the stocks exceed the limit of insurance cover value/sum insured then warehouseman shall immediately get enhanced the value of sum insured from insurance company otherwise, the warehouse has to bear the cost of un-insured stocks and has to pay to the depositor. In case of loss of stocks). Policy should give details of different stocks with “held in trust” clause.
  • Other risks such as floods and riots, strikes or terrorism shall be covered as an add on policy of special fire perils
  • Theft and burglary policy – The warehouseman has to take this policy on first loss basis and he shall ensure that the policy adequately covers the risks.
  • Misappropriation – The warehouseman shall take policy of covering losses of goods etc. due to fraudulent activities of an employee of warehouse, then the said risks shall be adequately covered.
  • Special fire perils policy (for a value not less than the actual value of the stocks held in storage at a given point of time and if the stocks exceed the limit of insurance cover value/sum insured then warehouseman shall immediately get enhanced the value of sum insured from insurance company otherwise, the warehouse has to bear the cost of un-insured stocks and has to pay to the depositor. In case of loss of stocks). Policy should give details of different stocks with “held in trust” clause
Yes Yes
Security Proper and adequate packaging of the goods.   Yes
Ensuring that all goods are transported in a safe manner to the Warehouse   Yes
The goods are to be accompanied with a person who has sufficient skill to handle the goods which also includes unloading from the vehicles and packing the same in the shifts.   Yes
Maintaining proper register of the goods which were unloaded in the warehouse.   Yes
Ensure that a copy of such list of goods are handed over to the warehouse in charge   Yes
Measures for the Warehouse:

  • Well protected boundary walls/barbed wire fencing etc.
  • Gates with appropriate locking arrangements.
  • Entry points & Exit Points guarded by trained security.
  • Security Cabin
  • Gate-Pass to be issues for the goods passing in and out from the warehouse
  • Register for Incoming and Outgoing vehicles, Employees
  • CCTV and/or biometrics systems in place
  • Packing and storage requirements as per Warehouse Manual for Operationalizing of Warehousing (Development & Regulation) Act, 2007 (37- 2007)
Yes  
Standards All godowns of 25000 MTs or above capacity will be preferably Railway siding godowns and all other godowns should be preferably within 8 Kms. of a Railway goods shed with full rake Railway siding facility. Yes  
Certificate from Bureau of Indian Standards (BIS)/ CWC/FCI Standards Yes  
If the warehouse does not have its own arrangement for pest control activity for scientific treatment, assaying of stocks and other activities such as security arrangements etc., then Authority will allow third party agreement with service providers and a copy of such agreements may be obtained by accreditation agency for submission to WDRA Yes  
FSSAI License/Registration Yes Yes
Ownership Documents Proof of ownership (Sale Deed, Tax Receipt, etc.); or Yes  
Registered lease Deed (rights with the warehouseman to use the relevant warehouse for the purposes of operating a warehouse) Yes  
Place of business

  • Address Proof of the Company (Title deed/lease deed/rent agreement of the premises, leased or rented out specifically for conducting such business)
  Yes
Proof of Address/Location of the Manufacturing (If Manufacture)

  • Occupancy Certificate (if claiming Ownership over the manufacturing land)
  • Lease Deed/Rent Agreement (if the manufacturing unit is rented/leased).
  Yes
Incorporation Documents

  • Incorporation Certification
  • Memorandum of Association
  • Articles of Association
  Yes
Receipts of the purchase Bills that show that the purchase of the good is complete.   Yes
Delivery records To authenticate actual delivery of the goods purchased, records of the same reaching the user.   Yes
Agreement of Sale To show that there is a subsisting agreement between the user and his source, for the subsequent sale of the particular good.   Yes
Import Proof Bill of Lading/Airway Bill /Rail receipt or any other despatch document, issued by a government agency (like the Department of Posts) or an agency duly authorized by the concerned Ministry/Department.   Yes
Environmental NOC from Fire and Emergency Services Department (e.g. In Karnataka it is issued by Karnataka Fire and Emergency Services Department)  

Yes

Yes

(If manufacturer)

NOC from the State Pollution Control Board (with the consent for establishment and consent for operations) Yes Yes

(If manufacturer)

Fire-fighting arrangements including Fire Extinguishers, Sand Buckets Yes  
Equipment’s, such as, sprayers, gas mask, canisters, gloves, gum boots, goggles, aprons, etc. available at the Warehouse (depending on the nature of goods being deposited at the warehouse) Yes  
Quantity of pesticides – insecticides for prophylactic treatment, fumigants for fumigation and rodenticides for rodent control. Yes  
If the warehouse does not have its own arrangement for pest control activity for scientific treatment, assaying of stocks and other activities such as security arrangements etc., then Authority will allow third party agreement with service providers and a copy of such agreements may be obtained by accreditation agency for submission to WDRA Yes  
NOC – Explosive Clearance License (Explosive Act, 1908 and Explosive Rules, 2008) Yes  
Clearance under Essential Commodities Act, 1955 Yes  
Labour Laws Compliances The proposed minimum manpower requirement are approved by the Authority with suggestions that in case pest control and security services are out sourced, the manpower requirement may be adjusted accordingly. Yes Yes
Registration under Employee State Employee State Insurance Act, 1948    
Registration Certificate under Contract Labour (Regulation and Abolition) Act, 1970 Yes  
Compliances Legal Meteorology act compliances (since the weight/ storage capacity plays major role in warehouse)

  • Proper and adequate packaging of the goods.
  • Ensure that all goods are transported in a safe manner to the Warehouse
  • The goods are to be accompanied with a person who has sufficient skill to handle the goods which also includes unloading from the vehicles and packing the same in the shifts.
  • Maintaining proper register of the goods which were unloaded in the warehouse.
  • Ensure that a copy of such list of goods are handed over to the warehouse in charge.
  Yes
Maintaining Net-Worth:

The minimum Net-worth applies to the warehouse on the basis of total storage capacity of goods in tonnes. The minimum net-worth requirements for registration with the Authority is 0.5 Crores where the total storage capacity in tonnes is at least Less than 1,000 tonnes

Yes  
State Specific Layout plan of the Warehouse (for e.g. Warehouse in Bangalore region requires a BBMP Approval or any such development authority approval, depending on the area i.e. Urban or Rural/SEZ, etc.) Yes  
Others Training for Warehouse Supervisor Training is also tailored to the Warehouse Supervisor, who has the primary authority and responsibility for overseeing the management of warehouse inventories.

  • Warehouse operations
  • Key Performance Measurement
  • Leading MRO materials team
  • ABC Analysis
  • Min / Max Modeling
  • Maintenance and Operations Coordination
Yes

 

Yes

 

 

 

 

 

 

 

Author: Govinda Toshniwal, Senior Associate

Advertisements