The main legal point established in the judgment is that the cost recovery charges for the services of customs officers at the ICDs/CFSs/ACCs/EPZs were upheld as being in the nature of a fee and had the statutory force of law.

CHANDER SHEKHAR, J.

This common judgment will dispose of the aforestated four writ petitions filed by different petitioners seeking similar reliefs. Petitioners have prayed for a writ, order or direction to declare levy and collection of cost recovery charges for posting of and work performed by the custom officers and staff at the Inland Container Depots (ICDs)/Container Freight Stations (CFSs)/Air Cargo Complexes (ACCs)/Export Processing Zones (EPZs) of the petitioners at Durgapur, Jodhpur, Sanand and Jaipur respectively, as wholly illegal, unlawful, null and void. The petitioners seek direction that the respondents should refund all the charges collected from them since inception. Another prayer made is for quashing of the demands issued for recovery of cost of custom staff at the rate of 1.85 times the salary of the custom staff posted at the respective ICDs/CFSs/ACCs/EPZs. It is also prayed that the Union of India should frame a policy to appoint and post custom officers at the ICDs/CFSs/ACCs/EPZs of the petitioners on non-cost recovery basis.

Additionally prayer in W.P.(C) No. 13770/2009, W.P.(C) No. 3912/2010 and W.P.(C) No. 6543 of 2010 is for the quashing of Guideline No.10 of Circular No.128/95-Cus, dated 14th December, 1995 (hereinafter the “impugned Guideline”) as being ultra vires to the provisions of Article 14 and Article 265 of the Constitution of India.

Petitioner in W.P.(C) No.6392/2012, has sought quashing of Regulation 5(2) of the Handling of Cargo in Customs Areas Regulations 2009 (hereinafter the “impugned Regulation”) and demand letter dated 29th June, 2012 as being ultra vires to the provisions of Article 14 and Article 265 of the Constitution of India. In W.P.(C) No.13770/2009, prayer has been made to quash the demand letter dated 09th June, 2009 issued by the respondents.

2. The prayers are predicated primarily on the plea that custom officers are permanent employees of the Union of India and duties performed by the custom officials at the ICDs/CFSs/ACCs/EPZs being sovereign functions, no charge could be recovered by the Union of India from the petitioners. The charge is not backed by any statutory provision.

3. Brief facts common to these writ petitions are as follows:-

Pursuant to the policy decision taken vide Circular No. 128/95-Cus dated 14th December, 1994, operation of ICDs/CFSs/ACCs/EPZs was opened to private sector. This was done to involve private sector in infrastructure development and to overcome congestion at the gateway ports arising from growth in business on account of widespread industrialization and economic growth. In order to decongest existing ports and cities, ICDs/CFSs/ACCs/EPZs were to be opened in the interior parts of the country. Government wanted ICDs/CFSs/ACCs/EPZs to be established across length and breadth of the country to encourage foreign trade and exports by facilitating custom clearance of goods at multiple points. These stations were to offer all services including custom clearance like any other port. Intention was to bring import and export facilities to the doorstep of the business community right across the country.

3.2 Applications and proposals for setting up the ICDs/CFSs/ACCs/EPZs by private or public sector required clearance from Inter-Ministerial Committee, which was given on the basis of recommendations of the jurisdictional Commissioner, who would first examine applications/proposals received on parameters stated in the guidelines. On clearance, letters of intent were issued and thereupon, the operator was required to set up infrastructure within the prescribed time. Jurisdictional Commissioner of Customs, on being satisfied that required infrastructure was in place, would then issue a notification under Section 8 of the Customs Act, 1962 (Act, for short), approving the concerned ICDs/CFSs/ACCs/EPZs. Operators of the said ICDs/CFSs/ACCs/EPZs were thereupon appointed as custodians under section 45 of the Act. Such appointment was conditional upon th