diff --git a/pkg/handlers/generic/lifecycle/config/cm.go b/pkg/handlers/generic/lifecycle/config/cm.go
index bbba7015e..7e2a6088d 100644
--- a/pkg/handlers/generic/lifecycle/config/cm.go
+++ b/pkg/handlers/generic/lifecycle/config/cm.go
@@ -123,6 +123,9 @@ func (h *HelmChartGetter) getInfoFor(
 	return &settings, err
 }
 
+// For returns the HelmChart info for the given component from the configmap referenced in the cluster variables.
+// It first checks the configmap referenced in the cluster variables.
+// If not found, it returns the HelmChart info from the default configmap.
 func (h *HelmChartGetter) For(
 	ctx context.Context,
 	log logr.Logger,
diff --git a/pkg/webhook/cluster/addons_validator.go b/pkg/webhook/cluster/addons_validator.go
index eb42e5924..50cdbf520 100644
--- a/pkg/webhook/cluster/addons_validator.go
+++ b/pkg/webhook/cluster/addons_validator.go
@@ -10,7 +10,7 @@ import (
 
 	v1 "k8s.io/api/admission/v1"
 	corev1 "k8s.io/api/core/v1"
-	"k8s.io/apimachinery/pkg/api/errors"
+	apierrors "k8s.io/apimachinery/pkg/api/errors"
 	clusterv1 "sigs.k8s.io/cluster-api/api/v1beta1"
 	ctrlclient "sigs.k8s.io/controller-runtime/pkg/client"
 	"sigs.k8s.io/controller-runtime/pkg/webhook/admission"
@@ -91,7 +91,7 @@ func validateCustomHelmChartConfigMapExists(
 		Name:      name,
 	}, configMap)
 	if err != nil {
-		if errors.IsNotFound(err) {
+		if apierrors.IsNotFound(err) {
 			return fmt.Errorf(
 				"HelmChart ConfigMap %q referenced in the cluster variables not found: %w",
 				name,
diff --git a/pkg/webhook/cluster/addons_validator_webhook_test.go b/pkg/webhook/cluster/addons_validator_webhook_test.go
new file mode 100644
index 000000000..a80a23f58
--- /dev/null
+++ b/pkg/webhook/cluster/addons_validator_webhook_test.go
@@ -0,0 +1,97 @@
+// Copyright 2024 Nutanix. All rights reserved.
+// SPDX-License-Identifier: Apache-2.0
+
+package cluster
+
+import (
+	"strings"
+	"testing"
+
+	. "github.com/onsi/gomega"
+	corev1 "k8s.io/api/core/v1"
+	metav1 "k8s.io/apimachinery/pkg/apis/meta/v1"
+	clusterv1 "sigs.k8s.io/cluster-api/api/v1beta1"
+
+	"github.com/nutanix-cloud-native/cluster-api-runtime-extensions-nutanix/api/v1alpha1"
+	apivariables "github.com/nutanix-cloud-native/cluster-api-runtime-extensions-nutanix/api/variables"
+)
+
+func TestBlockWithNonExistentHelmChartConfig(t *testing.T) {
+	g := NewWithT(t)
+
+	cluster := &clusterv1.Cluster{
+		ObjectMeta: metav1.ObjectMeta{
+			Name:      "cluster-with-non-existent-helm-chart-configmap",
+			Namespace: metav1.NamespaceDefault,
+		},
+		Spec: clusterv1.ClusterSpec{
+			Topology: &clusterv1.Topology{
+				Variables: []clusterv1.ClusterVariable{
+					*helmChartConfigVariable(t, "non-existent-helm-chart-configmap"),
+				},
+			},
+		},
+	}
+	err := env.Client.Create(ctx, cluster)
+	g.Expect(err).To(HaveOccurred())
+	g.Expect(strings.Contains(
+		err.Error(),
+		"HelmChart ConfigMap \"non-existent-helm-chart-configmap\" referenced in the cluster variables not found",
+	)).
+		To(BeTrue(), "Expected error to be of type IsNotFound")
+}
+
+func TestAllowWithExistingHelmChartConfig(t *testing.T) {
+	g := NewWithT(t)
+
+	configmap := &corev1.ConfigMap{
+		ObjectMeta: metav1.ObjectMeta{
+			Name:      "custom-helm-chart-configmap",
+			Namespace: metav1.NamespaceDefault,
+		},
+		Data: map[string]string{
+			"ccm": "test chart config data",
+		},
+	}
+	g.Expect(env.Client.Create(ctx, configmap)).ToNot(HaveOccurred())
+
+	cluster := &clusterv1.Cluster{
+		ObjectMeta: metav1.ObjectMeta{
+			Name:      "custom-helm-chart-configmap",
+			Namespace: metav1.NamespaceDefault,
+		},
+		Spec: clusterv1.ClusterSpec{
+			Topology: &clusterv1.Topology{
+				Variables: []clusterv1.ClusterVariable{
+					*helmChartConfigVariable(t, "non-existent-helm-chart-configmap"),
+				},
+			},
+		},
+	}
+	g.Expect(env.Client.Create(ctx, cluster)).ToNot(HaveOccurred())
+}
+
+func helmChartConfigVariable(
+	t *testing.T,
+	name string,
+) *clusterv1.ClusterVariable {
+	t.Helper()
+	hv, err := apivariables.MarshalToClusterVariable(
+		"clusterConfig",
+		&apivariables.ClusterConfigSpec{
+			Addons: &apivariables.Addons{
+				GenericAddons: v1alpha1.GenericAddons{
+					HelmChartConfig: &v1alpha1.HelmChartConfig{
+						ConfigMapRef: v1alpha1.LocalObjectReference{
+							Name: name,
+						},
+					},
+				},
+			},
+		},
+	)
+	if err != nil {
+		t.Fatalf("failed to create addon variable: %s", err)
+	}
+	return hv
+}