UP Mandi Fee Exemption for Food Processing

Under the Food Processing Industry Policy 2022-2027, the Uttar Pradesh government extends an incentive to processing units within the state. Agricultural produce brought into Uttar Pradesh from outside for processing is exempt from Mandi Fees and cess.

The measure is intended to bring down operating costs for food processing businesses. Lower costs are expected to draw in investment, support industrial growth and improve the sector's competitiveness within the state.

The policy targets both new processing units and the expansion of existing ones. Its stated outcomes include employment generation and value addition in the state's agricultural economy.

By removing market fees on raw materials sourced externally, the policy seeks a more level playing field and more efficient use of varied agricultural resources, in line with the 'Make in Uttar Pradesh' vision.

The Uttar Pradesh Food Processing Industry Policy 2022-2027 sets out the detailed procedure for claiming this Mandi Fee exemption within its full guidelines. In general, a processing unit would proceed as follows:

- **Registration and licences:** The processing unit must be properly registered in Uttar Pradesh and hold every operational licence and permit that state regulations require. - **Submission of application:** A formal application or declaration is to be filed with the designated state authority, for example the Department of Food Processing or the Mandi Parishad. The application has to state clearly what kind of agricultural produce is being brought in from outside the state. - **Documentation:** Papers establishing where the agricultural produce originated and confirming that it is meant for processing at the applicant's unit in Uttar Pradesh must be furnished in full. Purchase invoices, transportation documents and production plans may form part of this. - **Verification:** State authorities examine the application and the accompanying documents to confirm that all terms and conditions of the Food Processing Industry Policy have been met. - **Grant of exemption:** Once verification and approval are complete, the processing unit receives the exemption from Mandi Fees and charges, which lowers the cost of procuring raw material directly.

Eligibility for this exemption is assessed mainly by checking that the applicant satisfies the prescribed criteria. A processing unit in Uttar Pradesh has to show that the agricultural produce it processes is sourced from outside the state. Verification of the papers and of how the unit actually operates is carried out by the concerned state department or the Mandi Parishad, which confirms whether every condition laid down in the policy has been met before the exemption is allowed.