In exercise of the powers conferred by sub rule 1 of rule 19 of the Warehousing Development and Regulation Registration of Warehouses Rules

REGD. No. D. L.-33004/99 The Gazette of India CG-DL-E-12072024-255373 EXTRAORDINARY PART III—Section 4 PUBLISHED BY AUTHORITY No. 514] NEW DELHI, FRIDAY, JULY 12, 2024/ASHADHA 21, 1946 WAREHOUSING DEVELOPMENT AND REGULATORY AUTHORITY NOTIFICATION New Delhi, the 14th June, 2024 Requirement of Security Deposit for registration of warehouses with the Warehousing Development and Regulatory Authority No. T-23/3/2020-Technical-Part(1).—In exercise of the powers conferred by sub rule (1) of rule 19 of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017, and in suppression of the notification of the Warehousing Development and Regulatory Authority number No. T-23/3/2020-Technical 04th December, 2020 published in the Gazette of India, Extraordinary, Part III, Section-4, except as respects things done or omitted to be done before such suppression, the Warehousing Development and Regulatory Authority(hereinafter referred to as the Authority) hereby notifies the following procedure for requirement of security deposit for registration of warehouse with the Authority, namely:- 1. The applicant warehouse or Warehouse Service Provider seeking registration of a warehouse with the Warehousing Development and Regulatory Authority shall submit a security deposit to the Authority before issue of a registration certificate and such security deposit shall be submitted within twenty-one working days after issue of a communication by the Authority to this effect. 2. If the applicant fails to submit the security deposit within the period specified as above, the application shall be deemed to have been rejected: Provided that the Authority may, if it is satisfied that the applicant was prevented by sufficient cause from submitting the security deposit within the said period of twenty-one working days, allow it to submit the security deposit within such extended time as may be decided by the Authority. 3. Where the applicant submits the security deposit in the form and manner specified below, the Authority shall issue a certificate of registration to the applicant in respect of the warehouse to the applicant within five working days in the form specified in the Fourth Schedule of the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017. 4. Details of the amount and manner of security deposit to be furnished by the applicant or the warehouseman shall be in the following manner, namely:- i. The warehouseman shall maintain a security deposit with the Authority during period of registration which has two components, namely fixed and dynamic security deposit- The fixed security deposit amount is per warehouse belonging to the warehouseman registered with Warehousing Development & Regulatory Authority, whereas, the dynamic security deposit is a percentage of the maximum value of negotiable warehouse receipts outstanding in all the registered warehouses of a warehouseman on any day during the preceding month. a. For a warehouseman with a total capacity of all registered warehouses up to 2000 metric ton, the fixed security deposit is fifty thousand rupees per warehouse (as provided in column (3) of the Table-1 below for registration of warehouses), whereas, the dynamic security deposit is one per cent of the maximum value of negotiable warehouse receipts outstanding in all the registered warehouses of the warehouseman on any day during the preceding month, referred as T* as provided in column (4) of the Table I below. The total security deposit of a sum of columns (3) and (4) for warehouseman having total warehouse capacity of all warehouses registered with Warehousing Development & Regulatory Authority up to 2000 Metric Ton, will be limited to total security deposit as provided in column (5), of the Table I below: Table-I +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | Sl. No. | Total registered | Fixed security deposit | Dynamic security | Total security deposit limited to | | | warehouse capacity | | deposit | the amount | | | (in metric ton) for | | | | | | warehousemen | | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | (1) | (2) | (3) | (4) | (5) | +========+==========================================+=========================+===================+=====================================+ | 1. | Upto 100 | Rs. 50,000/- per | NIL | Total limited to Rs.50,000/- | | | | warehouse | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | 2. | 101 – 500 | Rs. 50,000/- per | 1% of T | Total limited to Rs.1.50 lakh | | | | warehouse | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | 3. | 501 – 1000 | Rs. 50,000/- per | 1% of T | Total limited to Rs. 2.50 lakh | | | | warehouse | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | 4. | 1001 – 1500 | Rs. 50,000/- per | 1% of T | Total limited to Rs. 3.50 lakh | | | | warehouse | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ | 5. | 1501 – 2000 | Rs. 50,000/- per | 1% of T | Total limited to Rs. 4.50 lakh | | | | warehouse | | | +--------+------------------------------------------+-------------------------+-------------------+-------------------------------------+ Note: T is the maximum value of negotiable warehouse receipts in all the registered warehouses of the warehouseman on any day during the preceding month. b. For a warehouseman with a total capacity of all registered warehouses above 2000 metric ton, the fixed security deposit is one lakh rupees per warehouse (as provided in column 5 in the Table II below for registration of warehouses), whereas, the dynamic security deposit is a percentage of the maximum value of negotiable warehouse receipts outstanding, in all the registered warehouses of the warehouseman on any day during the preceding month, referred as T* in the table II below. Column (3) is the required dynamic security deposit in the previous slab whereas column (4) is security deposit required in the referred slab for the dynamic security deposit. The cumulative value of fixed (column 5) and dynamic (column (3) and (4)) security deposit shall be maintained with Warehousing Development & Regulatory Authority as in the Table- II below: Table II +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | Sl. No. | Slab | Dynamic security deposit| Fixed security | | | | | deposit | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | (1) | (2) | (3) | (4) | (5) | +========+=====================================+=======================+=======================+=====================+ | 1. | T is less than or equal to Rs. 25 | 0 | 1% of T | Rs. 1 lakh per | | | crores | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | 2. | T is above Rs. 25 crores and | Rs. 25 Lakhs | 0.75% of T | Rs. 1 lakh per | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | 3. | T is above Rs. 250 crores and up to | Rs. 1.937 Crores | 0.50% of T | Rs. 1 lakh per | | | Rs. 2,500 crore | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | 4. | T is above Rs.2,500 crore | Rs. 13.187 Crores | 0.25% of T | Rs. 1 lakh per | | | | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ Note : T is the maximum value of negotiable warehouse receipts, in all the registered warehouses of the warehouseman on any day during the preceding month. ii. The fixed security deposit shall be maintained for a period of six months beyond the registration period whereas the dynamic security deposit shall be updated at the end of each month and submitted to the Authority, which shall be duly acknowledged and the validity of dynamic security deposit may be kept for a period of minimum six months so as to take care of any changes in the requirement of security deposit during this period. iii. The Authority may, adjust the security deposit already furnished by the warehouseman against the amount required to be furnished as security deposit. iv. Where the applicant or warehouseman is a Farmer Producer Organisation or a Primary Agricultural Cooperative Credit Societies or a Self Help Group, the total security deposit shall be fifty thousand rupees (total) per warehouse covering both the dynamic and fixed security deposit. v. The security deposit shall be in the form of Bank Fixed Deposits or in the form of Bank Guarantee (as per the format given in the First Schedule), or surety insurance policies or contracts or any other instrument decided by the Authority favouring Warehousing Development & Regulatory Authority. vi. The Authority may allow any entity created under an Act of Parliament or of a State Legislature to provide, an Indemnity Bond for the amount required as security deposit (as per format provided in the Second Schedule). vii. An entity allowed by the Authority to submit an Indemnity Bond shall submit, along with its application for registration, a resolution from its Board of Directors authorising to furnish such Indemnity Bond. viii. The security deposit shall be released as per the guidelines issued by the Authority from time to time. ix. The Authority shall refund the security deposit in respect of a warehouse, if- a. an application for renewal of registration of the warehouse has been rejected and if the Authority is satisfied that the warehouseman has discharged his obligations as per the requirements of the rules; or b. a warehouseman surrenders his certificate of registration, and the Authority accepts such surrender; or c. the certificate of registration of a warehouse is cancelled, and the Authority is satisfied that the warehouseman has discharged his obligations as per the requirements of the rules. x. Notwithstanding such revision of the security deposit as specified in sub-paragraph (i) and (ii), if any, the warehouseman shall not increase the charges payable by the depositors within the period of validity of negotiable warehouse receipts issued to them. FIRST SCHEDULE (Format for bank guarantee for security deposit payment to be submitted by the Warehouseman) Director (Administration and Finance) Warehousing Development and Regulatory Authority National Cooperative Union of India Building (4th Floor), 3, Siri Institutional Area, August Kranti Marg, Hauz Khas, New Delhi – 110016 (With due stamp duty as applicable) OUR LETTER OF GUARANTEE Number:- 1. In consideration of Warehousing Development and Regulatory Authority, having its office at National Cooperative Union of India Building (4th Floor), 3, Siri Institutional Area, August Kranti Marg, Hauz Khas, Delhi-110016 (INDIA) (hereinafter referred to as the WDRA which expression shall unless repugnant to the content or meaning thereof include all its successors, administrators and executors) and having considered granting or granted registration of the warehouse (s), namely, _____________________ or as per list annexed with this schedule (duly endorsed by the Bank) belonging to M/s________________ (hereinafter referred to as "the Warehouseman" which expression unless repugnant to the content or meaning thereof, shall include all the successors, administrators, and executors). 2. WHEREAS, the Warehouseman having unequivocally accepted to conduct business of warehousing as per terms and conditions provided in the Warehousing (Development and Regulation) Registration of Warehouses Rules, 2017 (hereinafter referred as the said rules) and having agreed to furnish to the WDRA a security deposit in the form of a Bank Guarantee for Rs......... (Rupees..................only) for the faithful performance of the entire registration with the WDRA, we....(hereinafter referred to as the Bank)at the request of the warehouseman do hereby undertake to pay to the WDRA an amount not exceeding Rs ..................against any loss or damage caused to or suffered by the holder of the negotiable warehouse receipt due to breach by the warehouseman of any of the terms and conditions ..............contained ..............in ..............the said rules ..............and the notification number...................dated the................... ..............on "Requirement of Security Deposit for registration of warehouses with the WDRA” (hereinafter referred as the notification). 3. We ...................................(Name of the Bank) do hereby undertake to pay the amount due and payable under this guarantee without any demur merely on a demand from the WDRA stating that the amount claimed is due by way of loss or damage caused to or suffered by the holder of the negotiable warehouse receipt due to breach by the warehouseman of any of the terms and conditions contained in the rules and the notification. Any such demand made on the bank shall be conclusive as regards the amount due and payable by the Bank under this guarantee. However, our liability under this guarantee shall be restricted to an amount not exceeding Rs.................................. 4. We undertake to pay to the WDRA any money so demanded notwithstanding any dispute or disputes raised by the warehouseman in any suit or proceeding pending before any Court or Tribunal relating thereto, our liability under this present being absolute and unequivocal. The payment so made by us under this bond shall be a valid discharge of our liability for payment thereunder and the warehouseman shall have no claim against us for making such payment. 5. We............................................................................... (Name of the Bank) further agree that the WDRA shall have the fullest liberty without our consent and without affecting in any manner our obligations hereunder to vary any of the terms and conditions of the said agreement or to extend time of performance by the Warehouseman from time to time or to postpone for any time or from time to time any of the powers exercisable by the WDRA against the warehouseman and to for bear or enforce any of the terms and conditions relating to the said agreement and we shall not be relieved from our liability under terms and conditions relating to the said agreement and we shall not be relieved from our liability by reason of any such variation, or extension being granted to the Warehouseman or for any forbearance, act or omission on the part of the WDRA or any indulgence by the WDRA to the warehouseman or by any such matter or thing whatsoever which under the law relating to sureties would, but for this provision, have effect of so relieving us. 6. This guarantee will not be discharged due to the change in the constitution of the Bank or the Warehouseman. 7. We,................................................... (Name of the Bank) Lastly undertake not to revoke this guarantee during its currency except with the previous consent of the WDRA in writing. 8. Notwithstanding anything contained herein :- i. our liability under this Bank Guarantee shall not exceed..................... (Rupees only) ii. this Bank Guarantee shall be valid upto............................................and iii. we are liable to pay the guaranteed amount or any part thereof under this Bank Guarantee only and only if the WDRA serve upon us a written claim or demand on or before................. (date of expiry of guarantee) Dated the......................... day of 20 Name of Authorised Signatory or Manager For (Name of the Bank) Branch Seal of the bank SECOND SCHEDULE INDEMNIT BOND This indemnity is executed by deed on the day of _______202__by______________________ ________________________(an entity created under the Act of the Parliament or of the State Legislative) hereinafter called Entity in favour of the Warehousing Development and Regulatory Authority hereinafter called Authority WHEREAS: a. The Authority is established under the Warehousing (Development and Regulation) Act, 2007 (Act, 2007) with the objective to regulate and ensure implementation of the provisions of said Act for development of warehouses, regulations of negotiability of warehouse receipts and promote orderly growth of warehousing business. Every person desirous of commencing or carrying business of maintaining a warehouse issuing negotiable warehouse receipts is required to be registered and for that purpose an application has to be made to the Authority under the said Act. b. Every applicant warehouse or Warehouse Service Provider seeking registration of their warehouse shall be required to submit security deposit to the Authority within twenty one days of the communication by the Authority. c. The value of security deposit (in the form of bank guarantee or surety insurance policies or contracts or any other instrument decided by the Authority in favour of Warehousing Development and Regulatory Authority) to be deposited by warehouseman and to be maintained during the period of registration and to be updated at the end of each month as provided in Table II of this notification is as follows: +--------+----------------------------+-----------------------+---------------------+ | Sl. No. | Slab | Dynamic Security Deposit| Fixed Security Deposit| +--------+----------------------------+-----------------------+---------------------+ | (1) | (2) | (3) | (5) | +========+============================+=======================+=====================+ | 1. | T is less than or equal to | 0 | Rs. 1 lakh per warehouse| | | Rs. 25 Crores | | | +--------+----------------------------+-----------------------+---------------------+ | 2. | T is above Rs. 25 Crores and up to | Rs. 25 Lakhs | 0.75% of T | Rs. 1 lakh per | | | Rs. 250 crore | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | 3. | T is above Rs. 250 Cores and up to | Rs. 1.937 Crores | 0.50% of T | Rs. 1 lakh per | | | Rs. 2,500 crore | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ | 4. | T is above Rs.2,500 crore | Rs. 13.187 Crores | 0.25% of T | Rs. 1 lakh per | | | | | | warehouse | +--------+-------------------------------------+-----------------------+-----------------------+---------------------+ Note: - Here ‘T' is referred in the above Table as highest value of total outstanding negotiable warehouse receipts in over the preceding month for all the warehouses registered by the warehouseman. d. The Authority may at its discretion, adjust the security deposit already furnished by warehouseman against the amount required as security deposit. The security deposit shall not be released until six months after cancellation, rejection or surrender of the registration of the warehouse or until after satisfaction of every claim against security deposit whichever is later. The Authority reserves its rights to revise the amount of security deposit. e. As the Authority may allow any entity created under an Act of the Parliament or State Legislative and carrying business of maintaining warehouse (s) and issuing Negotiable Warehouse Receipt, to submit Indemnity Bond in lieu of security deposit and the Entity allowed by the Authority to submit an Indemnity Bond shall submit, along with its application for registration, a resolution from its Board of Directors authorising the furnishing of such Indemnity Bond. NOW therefore M/s ................................................(name of the entity) established under ............................................ Act, agrees and undertakes at all times to save, defend, and indemnify and keep indemnified the Authority from and against all actions, suits, proceedings, accounts, claims and demands whatsoever for an amount of Rs.........(rupee only) (as detailed at Annexure) to the extent of limits to be worked out as provided in paragraph (c) above and as per the conditions of this indemnity bond noted below: - 1. M/s......................................................... (Name of the entity) shall comply with all the obligations to be performed on their part under the Authority's rules and regulations. 2. M/s......................................................... (Name of the entity) undertakes to keep the Authority indemnified for an amount to be worked out as per the Table mentioned in paragraph (c) above until six months, after cancellation, rejection or surrender of registration or until after satisfaction of every claim whichever is later. 3. M/s......................................................... (name of the entity) shall be discharged of its obligation under Indemnity Bond in respect of a warehouse, if: a. an application for renewal of registration of the warehouse has been rejected and if the Authority is satisfied that the warehouseman has discharged his obligations as per the requirements of the rules; b. a warehouseman surrenders his certificate of registration, and the Authority accepts such surrender; or c. the certificate of registration of a warehouse is cancelled, and the Authority is satisfied that the warehouseman has discharged his obligations as per the requirements of the rules. 4. M/s. .....................................................(Name of the entity) undertakes not to increase the charges payable by depositors within the period of Negotiable Warehouse Receipts issued to them. 5. M/s. .....................................(Name of the entity) hereby agrees that in case any losses or damages, if suffered by the Authority (to the extent of paragraph (c) above), the same shall be indemnified by M/s. .....................................(Name of the entity). 6. This Indemnity Bond shall have validity till___________day of____________(month)___________202....... In witness whereof signed this Indemnity Bond is executed on this_______________day of ___________________________________________________2024. Executor Name: Designation: Organisation: (With Seal) In the presence of witnesses: (1) (2) Annexure to the Second Schedule Details of warehouses included in the Indemnity Bond +--------+---------------------------------+-------------------------+ | Sl. No. | Name and address of the | Capacity in metric ton | | | warehouse | | +========+=================================+=========================+ | | | | +--------+---------------------------------+-------------------------+ JEETESH SHARMA, Director, (Admn. & Fin.) [ADVT.-III/4/Exty./283/2024-25]