Public Warehouse Licensing Regulations explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The Public Warehouse Licensing Regulations, 2016 say who can be licensed to run a public warehouse under section 57 of the Customs Act, 1962, what the applicant must provide, when a licence cannot be issued, how long it lasts and how it can be surrendered. A public warehouse is a site or building licensed by the Principal Commissioner or Commissioner of Customs where dutiable goods may be deposited.
A licence may go to an applicant who is an Indian citizen or a registered or incorporated entity, gives an undertaking, and furnishes a solvency certificate from a scheduled bank for two crore rupees (not required of Central, State or Union territory undertakings and notified major ports). After inspection the applicant provides an all risk insurance policy, two undertakings and a warehouse keeper. The licence remains valid until cancelled under section 58B or on surrender, and it is not transferable.
Position of the text: as amended up to the CBIC text updated 14 May 2016 (Notification No. 70/2016-Customs (N.T.) dated 14 May 2016); no amendment found up to 3 October 2026. Later notifications should be checked. This article describes the text as published.
The regulations were made under section 157 read with section 57 of the Customs Act, 1962. The Act's licensing provisions are explained in sections 57 and 58 of the Customs Act, 1962, and a general overview of warehouse types is in our post on customs bonded warehouse types and procedure. Operators planning a licence application can use our compliance advisory service. The sister regulations for private warehouses are covered in our article on the Private Warehouse Licensing Regulations, 2016.
Regulation 1 and regulation 2
The regulations came into force on the date of publication in the Official Gazette. Regulation 2 defines "applicant" as a person who applies for a public warehouse licence under section 57, and "public warehouse" as a site or building licensed as such by the Principal Commissioner or Commissioner of Customs under section 57, wherein dutiable goods may be deposited. Terms defined in the Act have the Act's meaning.
Regulation 3: licensing
Who may be licensed (regulation 3(1))
On an application, the Commissioner may issue a licence to an applicant who:
- is a citizen of India or an entity incorporated or registered under any law for the time being in force;
- submits an undertaking to comply with such terms and conditions as the Commissioner specifies; and
- furnishes a solvency certificate from a scheduled bank for a sum of two crore rupees.
The proviso says the solvency certificate condition does not apply to an undertaking of the Central Government, a State Government or a Union territory, or to ports notified under the Major Port Trusts Act, 1963.
When a licence must not be issued (regulation 3(2))
| Ground | Detail |
|---|---|
| (a) | The applicant has been declared an insolvent or bankrupt by a Court or Tribunal |
| (b) | The applicant has been convicted for an offence under any law in force |
| (c) | The applicant has been penalised for an offence under the Customs Act, the Central Excise Act, 1944 or Chapter V of the Finance Act, 1994 |
| (d) | The applicant is of unsound mind and has been so declared by a competent Court |
| (e)(i) | The Commissioner is satisfied that the site or building is not suitable for secure storage of dutiable goods |
| (e)(ii) | The site or building is not suitable for general supervision by officers of customs |
| (e)(iii) | Bankruptcy proceedings are pending against the applicant |
| (e)(iv) | Criminal proceedings are pending and the offences involved are of such nature that the applicant is not a fit person for grant of a licence |
The word "shall not" makes these bars. Grounds (a) to (d) are status-based; ground (e) depends on the Commissioner's satisfaction about the premises or the applicant.
Regulation 4: conditions after inspection
When, after inspection of the premises, evaluation of compliance with regulation 3 and such enquiries as are necessary, the Commissioner is satisfied that a licence may be granted, he requires the applicant to:
- (a) provide an all risk insurance policy, including natural calamities, riots, fire, theft, skilful pilferage and commercial crime, in favour of the President of India, for a sum equivalent to the amount of duty involved on the dutiable goods proposed to be stored in the warehouse at any point of time;
- (b) provide an undertaking binding himself to pay any duties, interest, fine and penalties payable in respect of warehoused goods under section 73A(3) or under the Warehouse (Custody and Handling of Goods) Regulations, 2016;
- (c) provide an undertaking to indemnify the Commissioner from any liability arising on account of loss suffered in respect of warehoused goods due to accident, damage, deterioration, destruction or any other unnatural cause during receipt, delivery, storage, despatch or handling; and
- (d) appoint a warehouse keeper who has sufficient experience in warehousing operations and customs procedures.
The insurance is sized to the duty involved on the goods that may be stored "at any point of time", so a warehouse that holds high-duty goods needs a larger policy.
Regulation 5: grant
On fulfilment of the conditions in regulations 3 and 4, the Commissioner may grant a licence for the public warehouse subject to such conditions as he deems necessary. "May" leaves a discretion even after the conditions are met.
Regulation 6: validity
A licence granted under regulation 5 remains valid until and unless it is cancelled under section 58B or under regulation 8(2). There is no fixed term and no renewal in the regulations.
Regulation 7: non-transferability
A licence granted under regulation 5 is not transferable. A change of owner or operator therefore needs a fresh licence, not a transfer.
Regulation 8: surrender
A licensee may surrender the licence by a written request to the Commissioner. On receipt, the Commissioner may cancel the licence if:
- the licensee has paid all monies due to the Central Government under the Act, rules or regulations;
- no warehoused goods remain deposited in the warehouse, or are deposited from the date of the request; and
- no proceedings are pending against the licensee under the Act, rules or regulations.
Regulation 9: existing public warehouses
A public warehouse appointed under section 57 as it stood immediately before the commencement of the Finance Act, 2016 was valid under these regulations provided that it fulfilled, within three months from the commencement of the regulations, the requirements in regulation 3(1)(b) and (c) and the conditions in regulation 4. This is a historical transition and is of interest mainly to old warehouses.
A worked example
Coastal Cargo Services Pvt Ltd, a registered company, applies for a public warehouse licence near a port. It submits the undertaking to comply with the Commissioner's terms and a scheduled bank's solvency certificate for two crore rupees. After inspection, the Commissioner is satisfied that the building is secure and open to supervision. Coastal buys an all risk insurance policy in favour of the President of India for the amount of duty on the goods it expects to hold, gives the payment and indemnity undertakings and appoints an experienced warehouse keeper. The Commissioner grants the licence, which stays valid until cancelled. When Coastal later closes the warehouse, it empties it, pays all dues, confirms nothing is pending and writes to surrender; the Commissioner may then cancel.
Need help with a public warehouse licence?
If you are preparing a section 57 application and want to check the solvency certificate, insurance and undertakings against regulations 3 and 4, our compliance advisory team can review the file before you apply.
Key takeaways
- The licensing authority is the Principal Commissioner or Commissioner of Customs.
- A solvency certificate of two crore rupees is required, except for Central, State or Union territory undertakings and notified major ports.
- Licences are barred on listed grounds including insolvency, conviction, penalty under customs or excise law, unsoundness of mind and unsuitable premises.
- The applicant gives an all risk insurance policy, a payment undertaking, an indemnity undertaking and a warehouse keeper.
- The licence stays valid until cancelled, is not transferable and may be surrendered on written request, subject to the Commissioner's conditions.
Read next
- Private Warehouse Licensing Regulations, 2016: licence, conditions and surrender
- Regulations 1-7 of the Warehouse (Custody and Handling of Goods) Regulations, 2016: keeper, facilities, receipt and transfer
- Sections 57 and 58 of the Customs Act, 1962: licensing of public and private warehouses
- Customs bonded warehouse: types and procedure
Disclaimer: Based on the customs regulations named above as published on the CBIC Tax Information Portal or in the Gazette and, for sets amended since 2023, the amending notifications (read through a TaxClue consolidated reading text; no official consolidated text exists), as consulted on 3 October 2026. Later notifications, fees and the Customs Act, 1962 provisions referred to should be checked. This article is general information, not legal advice; check the official text before acting.