Origin
India has long recognised the value of bonded manufacturing as a trade facilitation tool, with the power to permit manufacture inside a bonded warehouse embedded in Section 65 of the Customs Act as early as 1962. For decades, however, this route remained largely unused, since the Manufacture and Other Operations in Warehouse Rules, 1966 required a customs officer to be present for every operation inside the warehouse, making the scheme operationally impractical for most manufacturers.
Formalisation
Following amendments to the Customs Act in 2016 that shifted warehousing from physical customs control to custody-based, record-driven compliance, the Central Board of Indirect Taxes and Customs notified the Manufacture and Other Operations in Warehouse (No. 2) Regulations, 2019 on 1st October 2019. Introduced as part of the Government's Make in India and Ease of Doing Business agenda, MOOWR gave India, for the first time, a fully workable framework for duty-deferred manufacturing.
Benefits
A MOOWR unit enjoys a wide range of benefits — deferment of Basic Customs Duty and IGST on imported inputs and capital goods, with no interest liability during the deferment period; full remission of duty where the resultant goods are exported; no export obligation; no minimum investment criteria; and no restriction on where in India the unit may be located.
Deferred Duty becomes payable only when goods are cleared into the domestic market. In order to avail these benefits, the unit must adhere to prescribed conditions relating to licensing, bonding, premises, digital record-keeping, and periodic returns.
Our Services
We assist manufacturers and import-intensive businesses through every stage of the MOOWR journey — feasibility assessment, licence and bond structuring, premises readiness, and application filing, through to post-approval compliance.
Once the unit is operational, our team supports day-to-day compliance, including maintenance of the prescribed digital records, preparation of monthly returns, and reconciliation between customs and financial records, so that the deferred duty benefit is correctly availed and audit risk is kept to a minimum.
These functions are backed by regular updates on the evolving regulatory environment from our leadership group and senior professionals.
