The CBIC vide Circular No. 28/2019-Customs dated September 03, 2019 has clarified the issue of putting of mono-cartons on Bottled in Origin (BIO) alcoholic beverages (“the product”) in both Public and Private bonded warehouses.
It has been clarified that Clause (b) of section 64 of the Customs Act, 1962 (“the Customs Act”) allows the owner of the warehoused goods to deal with the containers in such manner as may be necessary to prevent loss or deterioration or damage to the goods. Since the original shipper’s carton in which the goods are imported has to be removed to comply with the statutory labelling requirements and thereafter, the goods have to be packed in the mono carton and an outer carton which enable safe transport, these activities are permissible in both public and private bonded warehouses under clause (b) of section 64 of the Customs Act.
Further, it has been also clarified that there is no resultant product, distinct from the BIO alcoholic beverages that arises due to putting of the mono-carton. Thus, the activity of putting a mono carton cannot be considered as processing and hence cannot be allowed under section 65 of the Customs Act. It is also not the policy intent to allow the extended warehousing benefits available under section 61 for units operating under section 65, for activities such as placement of mono-cartons over BIO alcoholic beverages.