IMPORTANT POINT
The court ruled that the recovery of cost recovery charges under HCCAR, 2009 was not lawful as the provisions invoked did not support such recovery.

JUDGMENT :

Per Dr. Pushpendra Singh Bhati, J :

1. The present bunch of appeals and writ petitions have been preferred claiming, in sum and substance, the following reliefs:

Appeals by the Revenue (Customs Department):

“1. It is, therefore, prayed that this appeal be accepted and the Hon’ble Court may be pleased to set aside the impugned final order dated 26.07.2019 passed by the ld. CESTAT and restore the Order-in-Original dated 26.02.2019 passed by the ld. Commissioner.

2. It is also prayed that the substantial question of law mentioned in para 12 of the present appeal, arising out of the impugned Final Order dated 26.07.2019 passed by the ld. CESTAT may be admitted, decided, considered and an ordainment or direction, which may be just and proper in favour of the appellant may be passed.

3. It is also prayed that an ad-interim stay be granted and the operation of the impugned Final Order dated 26.07.2019 passed by the ld. CESTAT may be stayed until the final decision of the instant appeal is taken.

4. Any other order or direction which this Hon’ble court deems just and proper in the facts and circumstances of the case may also be passed in favour of the appellant.”

Writ Petitions Companies (in short, ‘Dry Ports’):

“It is, therefore, most humbly and respectfully prayed that the present writ petition may kindly be allowed and by an appropriate writ, order or direction:

i. The impugned show cause notice dated 11.10.2019 issued by the Respondent-Commissioner of Customs (Preventive), Jodhpur be quashed and set aside and so also the consequential actions be taken in pursuance thereof.

ii. The respondents be directed not to revoke the license of custodianship granted to the petitioner.

iii. The respondents be directed not to recover the cost of recovery charges from the petitioner.

iv. Any other writ, order or direction that this Hon’ble Court may deem appropriate in the facts and circumstances of the case may kindly be passed in favour of the petitioner.”

2. A Coordinate Bench of this Court had formulated the following substantial question of law, while admitting the instant appeal(s):

“Whether learned Customs, Excise & Service Tax Appellate Tribunal (CESTAT) was justified in law in holding that the authority had no jurisdiction either under the Customs Act or under the Handling of Cargo in Customs Areas Regulations, 2009 (HCCAR) to order recovery?”

3. Brief facts of the case, as noticed by this Court, are that in the year 1995, the Central Government made efforts to decongest the ports by providing entry points to facilitate the customs clearance of goods for exports and imports in Dry Ports. Thus, the creation of the entry points away from the Ports and providing customs facilities therein, was with an intention of providing smooth export and import facilities to the business enterprises and also to make the process hassle free for the businessmen. The Inland Container Depots (ICDs) and Container Freight Stations (CFSs) were set in and a mechanism was drawn by Circular dated 17.10.1997, whereby the postings of staff in ICDs and CFSs pertaining to collection of cost recovery charges were made.

4. The Dry Ports in question in accordance with the said Policy of 1995 sought to set up their CFSs at the respective towns, in this case, it is Jodhpur by an application dated 25.10.1998. The CFSs at Jodhpur pertaining to export and import cargo were thus proposed to be made and all the necessary facilities were to be provided. The Ports in question, were to be provided certain facilities by the Commissioner of Customs to enable smooth functioning of the CFSs/ICDs on the basis of cost recovery charges. The Dry Ports in question, like M/s. Thar Dry Port was declared as custodian vide notification dated 19.11.2001 and declared as an ICD vide order dated 29.11.2001.

5. As the facility developed, the Government brought in a notification dated 17.03.2009, notifying the Handling of Cargo in Customs Areas Regulations, 2009 (hereinafter referred to as ‘HCCAR, 2009