NEW DELHI : The Union Food and Public Distribution Ministry has suggested major amendments to the Warehousing (Development and Regulation) Act of 2007. The Ministry says that the aim is to help farmers get access to the service of quality warehouses. An official in the Ministry said the amendment was to make registration of godowns compulsory and to raise the penalty for various offences. 

At present, the registration with the Warehousing Development and Regulation Authority (WDRA) is optional. After the proposed amendment, which is yet to be cleared by the Cabinet, registration of all third party warehouses throughout the Country will be undertaken in a phased manner. “The Central Government will have powers to exempt any class of warehouses from registration with the Authority. This will ensure a gradual and non-disruptive change to a regulated warehousing system,” the official said.

The WDRA was established in 2010 to ensure scientific storage by prescribing infrastructural and procedural standards. Captive warehouses such as those of the Food Corporation of India are excluded from the ambit of the Act. The Act wants to establish a system of negotiable and non-negotiable warehouse receipt (NWR) which is now in electronic form. The official said the Centre wanted to make NWR a tool of trade to improve fiduciary trust of depositors and banks in Negotiable Warehouse Receipt System.

If amended, the Act will help in doing away with accreditation agencies. “Accreditation Agencies are not required, as the process was time-consuming, prone to malpractices and led to complaints,” the official said. The application for registration of warehouses will be submitted directly to the WDRA and a new system of online application, which will be contactless and faceless will be implemented and the average registration time will be reduced. “That apart, the Government has proposed doing away with up to three years imprisonment for various offences but suggested significant increase in penalty from the current Rs. 1 lakh for various offences,” 

the official added.

The Ministry’s intention is to bring the Bill in the ongoing monsoon session of Parliament. At present, there are about 60,000 warehouses in the Country. “Out of which, 4,700 warehouses have registered with the regulator but only 2,910 warehouses are active ones,” the official added.

In the first phase, the Centre plans to register warehouses with capacity above 5,000 tonnes followed by ones above 1,000-5,000 tonnes and then above 100 tonnes capacity. “This will help farmers/depositors to have access to a large number of buyers nationwide with better bargaining power,” the official said.