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Unit 9: Warehousing

Government and is called “State Excise” duty. The Excise duty on rest of goods is called “Central Notes
Excise” duty. Manufacturers can have holding bonded warehouses for storing non-duty paid
goods. While different procedures have been prescribed for levy and collection of Central
Excise Duties keeping in view the needs of different industries sectors, Self Assessment Procedure
covers a major portion of excisable items. However, for state excise, each state has its own
procedures.

9.3.3 Public Warehousing

The Central Warehousing Corporation (CWC) was set up in 1957 under the Agricultural Produce
Development and Warehousing Corporations Act, 1956. Functions of CWC under the provisions
of the Act are:
(a) Acquire and build godowns and warehouses at such suitable places in India as it thinks fit;

(b) Run warehouses for the storage of agricultural produce, seeds, manures, fertilizers,
agricultural implements and notified commodities offered by individuals, cooperative
societies and other institutions;
(c) Arrange facilities for the transport of agricultural produce, seeds, manures, fertilizers, and
agricultural implements and notified commodities to and from warehouses;
(d) Subscribe to the share capital of a State Warehousing Corporation;
(e) Act as agent of the government for the purposes of the purchase, sale, storage and distribution
of agricultural produce, seeds, manures, fertilizers, agricultural implements and notified
commodities; and
(f) Carry out such other functions as may be prescribed.

The Central Warehousing Corporations Act of 1962 had twin objectives, that is, to provide
scientific storage for agricultural produce and also to provide market finances. CWC plays an
important role in the chain of marketing for agricultural produce. It serves not only as a time
and space value but also adds place value to the goods.
There are three agencies in the public sector which are engaged in building large scale storage/
warehousing capacity namely, Food Corporation of India (FCI) Central warehousing Corporation
(CWC) and 17 State Warehousing Corporation (SWCs). The total capacity of public warehousing
as of October, 2006 was 56.50 million tonnes.
The Central Warehousing Corporation (CWC) was set up in 1957 and is the largest public
warehousing organization. It had a turnover of $ 6,190 million during the year 2005–06 with a
net profit of $ 1060 million. The CWC has two types of warehouses: Owned Capacity and Hired
Capacity. CWC holds 4,564 warehouses in India with a capacity of 8.00 million MTs, under the
owned capacity category. The hired capacity is around 2.40 million tonnes.
Apart from storage, CWC also offers services in the area of clearing and forwarding, handling
and transportation, distribution, disinfestation, fumigation and other ancillary services like
safety and security, insurance, standardization and documentation. The CWC has also introduced
a scheme, called the Farmers’ Extension Service at selected centres to educate farmers about the
benefits of a scientific storage.

The CWC is also operating custom bonded warehouses. These bonded warehouses are constructed
at a seaport or airport and accept imported commodities for storage till the payment of customs
duties by the importer of the commodities. Though the primary focus of CWC is on trade and
commerce in and supply and distribution of food grains, the most lucrative and profitable
segment of CWC is custom-bonded warehouses.

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