MOOWR Scheme (Manufacturing and Other Operations in Warehouse) – Complete Guide for Indian Manufacturers
✓ Maximize Cash Flow: Defer Duty with MOOWR Scheme
✓ Import Raw Materials & Machinery Duty-Free Until Use
✓ No Export Obligations. Full Flexibility to Sell Anywhere
✓ Simplified Compliance & Single-Point Customs Approval
✓ Import Raw Materials & Capital Goods Duty-Free
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Table of Contents
MOOWR Scheme
- Overview of the MOOWR Scheme
- Latest Updates in MOOWR Regulations
- Circular No. 19/2025-Customs dated 23.07.2025:
- What is MOOWR Scheme?
- Features of the MOOWR Scheme:
- MOOWR Scheme Advantages & Disadvantages
- Comparison with Other Duty Deferment Schemes (SEZ, EOU, EPCG, etc.)
- Procedure to Avail MOOWR Scheme
- Required Documents
- How We Assist You
- FAQ’s
- Why Afleo Group?
The MOOWR Scheme – full form: Manufacturing and Other Operations in Warehouse Regulations, 2019 is a customs duty deferment scheme introduced by CBIC under Notification No. 69/2019-Customs (N.T.) dated 1st October 2019. Under the MOOWR Scheme, any manufacturer can import raw materials and capital goods without paying Basic Customs Duty (BCD) and IGST upfront, by converting their manufacturing facility into a Private Customs Bonded Warehouse. The duty is either deferred (for domestic sales) or fully exempt (for exports). Unlike EPCG, Advance Authorisation, or SEZ schemes, MOOWR imposes no export obligation – making it accessible to businesses supplying both domestic and international markets.
Overview of the MOOWR Scheme
Afleo is an expert in offering turnkey solutions for companies that wish to avail the benefits of the MOOWR Scheme – short for Manufacturing and Other Operations in Warehouse Regulations – is a customs duty deferment scheme. Whether you are an exporter or a domestic producer, our expertise guarantees you get the best out of this duty deferment scheme while remaining in compliance.
The MOOWR scheme benefits companies by improving cash flow as it defers customs duties so that they can invest in business again. Further, it wipes out the burden of prompt duty payments, which makes it extremely appealing for manufacturers in search of long-term financial viability.
How the MOOWR Scheme Works — Step by Step
The MOOWR Scheme operates on a simple bonded manufacturing principle:
Step 1 — Convert Your Facility into a Bonded Warehouse Your existing manufacturing unit is registered as a Private Customs Bonded Warehouse under Section 58 of the Customs Act, 1962. This is a one-time registration with no renewal required.
Step 2 — Import Duty-Free Raw materials and capital goods are imported and deposited in the bonded warehouse by filing a Bill of Entry for Warehousing — without payment of BCD or IGST. No bank guarantee is required.
Step 3 — Manufacture Inside the Bonded Unit Manufacturing, processing, assembly, testing, labelling, repacking, or other approved operations are carried out on the imported goods within the MOOWR unit.
Step 4A — If You Export Finished goods are exported from the MOOWR unit. The deferred customs duty on the imported inputs is fully remitted — meaning zero duty is payable. No interest applies.
Step 4B — If You Sell Domestically When finished goods are cleared for home consumption, the applicable BCD and IGST on the inputs used are paid at that point — with no interest. You only pay duty when goods actually leave the bonded unit for domestic sale.
Step 5 — Capital Goods Capital goods (machinery and equipment) imported under MOOWR remain in the bonded unit. Duty on capital goods is payable only if the machinery itself is removed for domestic sale. Since machinery typically stays in the factory permanently, this effectively results in a permanent duty saving on capital goods.
Latest CBIC Notifications & Updates on MOOWR Scheme (2026)
The MOOWR Scheme has witnessed numerous regulatory updates in sync with changing trade policies. Some of the recent modifications include:
Circular No. 19/2025-Customs dated 23.07.2025:
- CBIC has announced the continuation of the online application facility under the MOOWR Scheme hosted on the Invest India portal until 31st October 2025. This decision reverses Circular No. 18/2025-Customs, which had discontinued the digital application process. Applicants may continue to use the portal at https://www.investindia.gov.in/bonded-manufacturing for submitting applications under Sections 58 and 65 of the Customs Act. An alternate digital system is under development, and detailed transition guidelines will be issued separately. Field formations have been directed to notify stakeholders and provide necessary support.
Circular No. 18/2025-Customs dated 22.07.2025:
- CBIC has announced that the digitized application form for the MOOWR Scheme, previously available on the Invest India microsite, is no longer available for submission. Applicants seeking a license under Section 58 and permission under Section 65 of the Customs Act must now submit applications directly to the jurisdictional Principal Commissioner or Commissioner of Customs in the prescribed format. Field formations have been instructed to inform and guide the trade accordingly.
- Increased digital compliance for MOOWR (Manufacturing and Other Operations in Warehouse) units by mandating the filing of electronic records of stock and duty payments.
- Streamlining Ex-Bond Bill of Entry filing to minimize operational impediments and enhance efficiency.
- More discretion to Customs authorities in the monitoring of MOOWR units to maintain duty deferment conditions.
- Clarifications regarding the warehousing period to avoid abuse and transparency in stock movement.
What is the MOOWR Scheme? (Full Form & Meaning)
The MOOWR Scheme or the Scheme for Manufacturing and Other Operations in a Warehouse is a deferment scheme for customs duty initiated by the Indian government to promote manufacturing and exports. It enables enterprises to postpone customs duty on imported raw materials and capital goods, resulting in considerable cost reduction and flexibility. This scheme is particularly useful for businesses that use imported inputs for manufacture.
Key Benefits of the MOOWR Scheme for Manufacturers
- Exemption of customs duty (BCD + IGST) on raw materials imported for exports, which lowers costs substantially.
- Payment of duty on raw materials utilized in domestic sales deferred, with payment to be made only at the time of removal and without interest.
- Exemption of capital goods from duty (depreciation not permissible), facilitating ease of investment in infrastructure by companies.
- No export commitment, in contrast to SEZ and EOU schemes, which leaves room to supply both domestic and overseas markets.
- Indefinite warehousing duration without obligation to fulfill export commitment.
- Better management of cash flows, which allows businesses to re-invest in business operations before payment of duty, alleviating financial pressures.
- Less compliance requirement, hence making it easier for business firms to conduct operations compared to other duty-free schemes.
MOOWR Scheme vs EPCG vs Advance Authorisation vs EOU
| Parameter | MOOWR Scheme | EPCG Scheme | Advance Authorisation | EOU / SEZ |
|---|---|---|---|---|
| Duty Benefit | Deferment (BCD + IGST) | Zero duty on capital goods | Zero duty on raw materials | Zero duty on inputs |
| Export Obligation | None | 6x duty saved in 6 years | Mandatory | Positive NFE required |
| Eligible Goods | Raw materials + capital goods | Capital goods only | Raw materials/inputs only | Inputs + capital goods |
| Domestic Sales | Permitted (duty paid at removal) | Permitted | Not applicable | Limited (subject to duty) |
| Geographic Restriction | None — any Indian unit | None | None | Must be in notified zone (SEZ) |
| RoDTEP / Duty Drawback | Not available | Available | Available | Not available |
| Bank Guarantee | Not required | Required (if not Star Export House) | Required | Not required |
| Registration | One-time, permanent | Per license, 6-year validity | Per license | Permanent (till surrender) |
| Best For | Manufacturers with domestic + export sales | Businesses importing machinery | Exporters with defined input-output norms | Large export-focused units |
Key Takeaway: If your business exports regularly and needs machinery, EPCG is ideal. If you import raw materials with a defined export product, Advance Authorisation works best. If you manufacture for both domestic and export markets without wanting to commit to export obligations, MOOWR is the most flexible option.
Not sure which scheme applies to you? Contact Afleo for a free assessment.
Which Industries Benefit Most from the MOOWR Scheme?
The MOOWR Scheme is open to all manufacturers without any minimum investment threshold. The following sectors have seen the highest adoption:
Electronics & Mobile Manufacturing — Companies assembling smartphones, PCBs, and electronic components defer BCD and IGST on imported components, significantly reducing working capital requirements.
Pharmaceuticals & Chemicals — Pharma manufacturers importing Active Pharmaceutical Ingredients (APIs) and chemical intermediates benefit from duty deferment on raw materials with no export commitment pressure.
Automotive & Auto Components — Auto parts manufacturers importing specialised components or tooling can defer duties and maintain flexibility to sell to both OEM domestic clients and export markets.
Textiles & Apparel — Fabric and yarn importers who sell partly to domestic brands and partly to export buyers benefit from MOOWR’s no-obligation structure.
Food Processing — Units importing processing machinery and raw materials can operate duty-free on the capital goods side while managing domestic and export sales freely.
Renewable Energy (Solar, Battery Storage) — An emerging and active area; MOOWR has been widely used for importing battery storage system components. Note: As of April 2026, the Department of Revenue is reviewing MOOWR usage for battery energy storage projects — businesses in this sector should monitor updates.
MOOWR Scheme Advantages & Disadvantages
Advantages:
- Deferment of Duty – Pay duty only when the goods are unloaded for sale within the country, enhancing liquidity.
- No Geographic Limitations – Any unit in India can be a MOOWR unit, ensuring higher accessibility.
- No Export Commitment – A perfect option for companies dealing in both domestic and foreign markets.
- Smooth Warehousing – No time limit for storage, enabling firms to manage their production calendar systematically.
- Flexibility for Manufacturers – Companies with uncertain export demand can still access duty benefits without export commitment.
- Investment Promotion – With capital goods exemption, firms can invest in improved technology and machinery without the burden of immediate duty.
Drawbacks:
- No Duty Drawback or RoDTEP benefit to exporters, reducing further incentives.
- No depreciation relief on capital goods, affecting tax savings.
- Removal of IGST exemption under Section 65A (Finance Bill 2023), impacting businesses that used this exemption to reduce costs.
- Operational inconvenience of filing Ex-bond Bill of Entries, involving additional paperwork for businesses.
- Unclear procedures, involving specialized advice to understand compliance and sidestep penalties.
Comparison with Other Duty Deferment Schemes (SEZ, EOU, EPCG, etc.)
MOOWR Scheme is distinct from other duty deferment schemes in the following aspects:
| Feature | MOOWR | SEZ | EOU | EPCG |
|---|---|---|---|---|
| Duty Payment | Deferred until removal for domestic sales | Exempted for exports | Exempted for exports | Exempted subject to export obligations |
| Export Obligation | No | Yes | Yes | Yes |
| Geographical Restrictions | None | Must be in an SEZ | Must be an EOU unit | None |
| Depreciation on Capital Goods | Not allowed | Allowed | Allowed | Allowed |
| Ideal for | Businesses with both domestic & export sales | Exporters | 100% export businesses | Capital goods importers with strong export focus |
Key Takeaway – MOOWR (Manufacturing and Other Operations in Warehouse) is more flexible than SEZ, EOU, or EPCG since it does not involve an export obligation, which makes it suitable for firms with high domestic sales in addition to exports.
Procedure to Avail MOOWR Scheme
To avail the MOOWR Scheme, businesses need to adhere to a systematic application process:
1. Eligibility Assessment – Knowing whether your business is eligible for MOOWR according to its manufacturing and import needs.
2. Filing of Application – Filing of MOOWR (Manufacturing and Other Operations in Warehouse) registration with the Customs Department to ensure proper documentation as required.
3. Warehouse Registration – Section 65 approval of bonded warehouse to enable deferral of duties by businesses.
4. Execution of Bond & Security – Filing necessary bonds and securities with customs to ensure compliance with scheme conditions.
5. Customs Approval & Licensing – Obtaining the last approval from customs to commence operations under the MOOWR scheme.
6. Ongoing Compliance & Reporting – Keeping records and meeting periodic reporting obligations to customs authorities.
Documents Required for MOOWR Registration
In order to apply for the MOOWR Scheme, the following documents are usually required:
- Business Registration Certificate
- GST Registration
- Import Export Code (IEC)
- Manufacturing premises details
- Inventory records of imported items
- Financial statements and tax returns
- Bond and security information
How We Assist You
At Afleo, we demystify the intricacies of the MOOWR Scheme with our export-import solution expertise. Our services are:
- Eligibility Analysis – Evaluating your business model and recommending the appropriateness of MOOWR.
- End-to-End Application Support – Support in documentation and filing for MOOWR registration.
- Regulatory Compliance – Support to remain in compliance with customs procedures and legal processes.
- Customs & Banking Liaison – Coordination with customs departments, DGFT, and banks to complete smooth approvals.
- Post-Approval Support – Regular support for warehousing, duty payments, audits, and renewals.
Limitations of the MOOWR Scheme — What You Should Know Before Applying
While the MOOWR Scheme offers significant advantages, it is important to understand its limitations before deciding if it is right for your business:
No RoDTEP or Duty Drawback Benefits Exporters operating under the MOOWR Scheme are not eligible to claim RoDTEP (Remission of Duties and Taxes on Exported Products) or Duty Drawback on their exports. If your business relies heavily on these incentives, this is a significant trade-off to evaluate.
No Depreciation on Capital Goods Customs duty on capital goods under MOOWR is deferred, not waived. This means the duty is payable if machinery is removed from the bonded unit. Additionally, no income tax depreciation benefit is available on the deferred duty component.
IGST Exemption Removed (Finance Bill 2023) Section 65A, which previously allowed IGST exemption on goods manufactured in bonded warehouses, was removed via the Finance Bill 2023. Businesses that structured their operations around this exemption need to recalibrate their cost models.
Digital Compliance Burden MOOWR units are required to maintain electronic records of all stock movements, duty payments, and production activities. Monthly filings and periodic audits by Customs authorities require dedicated compliance resources.
Online Application Portal Discontinued As of late 2025, the Invest India MOOWR portal is no longer accepting applications. All applications under Section 58 and Section 65 of the Customs Act must now be submitted directly to the jurisdictional Principal Commissioner or Commissioner of Customs in the prescribed physical format.
Solar Units Excluded As per Instruction No. 13/2022-Customs, certain solar panel manufacturing units have specific restrictions under MOOWR. Businesses in this sector should seek expert guidance before applying.
FAQ’s
What is the full form of MOOWR?
MOOWR stands for Manufacturing and Other Operations in Warehouse Regulations. The scheme was introduced under Notification No. 69/2019-Customs (N.T.) by CBIC on 1st October 2019.
How is MOOWR different from SEZ, EOU, and Advance Authorization?
In contrast to SEZ and EOU, MOOWR (Manufacturing and Other Operations in Warehouse) does not have an export obligation, thus rendering it more accommodating for businesses with a domestic sales orientation. Advance Authorization and EPCG demand that companies satisfy stringent export requirements, while MOOWR supports duty deferment without the imposition of such requirements.
Is any business eligible to take advantage of the MOOWR Scheme?
Yes, any manufacturing or trading unit that has dealings in imported raw materials and capital goods can apply for the MOOWR Scheme.
What if I do not export under the MOOWR Scheme?
No export obligation is applicable under MOOWR. In case you utilize the imported goods for sale in the domestic market, you need to pay only the applicable customs duties at the time of removal from the warehouse
Is there any time limit for warehousing under the MOOWR Scheme?
No, companies can store goods any number of times without any limitation in the bonded warehouse.
What is the MOOWR Scheme in simple terms?
The MOOWR Scheme allows any Indian manufacturer to import raw materials and capital goods without paying customs duty upfront. The duty is deferred until finished goods are sold in the domestic market. If goods are exported, no duty is payable at all. The factory is converted into a Private Customs Bonded Warehouse for this purpose.
Why Afleo Group?
Afleo is a brand name in Export & Import solutions, with the expertise to deliver:
- DGFT, Customs, Banking, Logistics, and Export Incentives.
- Freight Forwarding & Trading of RoDTEP, RoSCTL, DFIA Licenses.
- End-to-end regulatory and legal guidance.
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