TaxTMI 
TaxTMI 
2025 (12) TMI 647
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....gulation 12 (8) of the 2009 Regulations. 2. The facility of customs clearance of goods for export/ import and for assessment, levy and collection of customs duty in hinterland in important cities with a view to decongest the Ports at Entry Points was started sometimes in 1995. For this purpose, help was sought from private/public sectors for providing premises suitable for Customs Officers and could be declared as "Customs Area" and "Customs Ports" as defined under the Customs Act 1962. Such Container Freight Stations, Air Cargo Complexes6 and Inland Container Depots (ICD) were opened to facilitate imports and exports of goods. The goods to be exported are brought to the sites for examination by the Customs Officers and after completion of the custom formalities are allowed to be exported. Similarly, goods which are imported are also brought directly from the ship to the sites after unloading them in the specified ports for examination. For providing this facility, the Custodian is permitted to charge a certain amount per container from the exporter/ importer as handling charges. 3. Thar Port submitted an application on 25 October, 1998 to the Government of India, for setting....
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....ve achieved the requisite target. 6. However, show cause notice dated 9 January 2013 was issued to the appellant purportedly under regulation 12 of the 2009 Regulations. The notice mentioned that previously the procedure for appointment of Custodian as ICD/CSF was prescribed under the Board Circular dated 14 December 1995, but the procedure was now laid down under the 2009 Regulations. After referring to the various provisions of the 2009 Regulations, it was stated that the appellant did not fulfill the conditions set out in regulations 4, 5 and 6 of the 2009 Regulations and the Board Circular dated 14 December 1995 and, therefore, it rendered itself liable for suspension/ revocation of approval of the Custodianship in terms of the provisions contained in regulation 11(1) of the 2009 Regulations and also forfeiture of security and imposition of penalty under regulation 12(8). 7. A detailed reply was filed by the appellant to the show cause notice. It was stated that the Government of India had announced a policy for granting exemption/ waiver on the payment of cost recovery charges if ICD/CSF satisfied the minimum workload criteria as provided for in the Notification dated 12....
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....ed by the Ministry of Finance. Therefore, Regulation 6(1)(o) of the Regulation (6) is not meant for recovery of default payment but only it says that the CCSP will have to bear the cost of officer deployed at their premises. Similarly, Regulation (12) of the CCAR does not prescribe for the recovery of defaulted cost recovery charge. But only states that the same is procedure for suspension or revocation of approval and imposition of penalty. 14. In view of above, we find that the learned Adjudicating Authority has not appreciated the legal provision as contained in HCR, referred above which do not indicate the machinery for realisation of cost recovery charge on account of being defaulted as is the case before us. In fact, we find that the show cause notice has invoked the provisions of Regulation 12 of HCCAR which does not provide for the realisation of the cost recovery charge but only revocation of the licence granted to CCSP on account of various breaches as contained therein. This regulation has no provisions for recovery of unpaid cost recovery charge on account of non-fulfilment of criteria as laid down in the CBEC circular. Thus, we find that the order passed by th....
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..... 20. In the opinion of this Court, the impugned notices and the order of the Commissioner, ought to have been considered on merits by the learned CESTAT while also dealing with the issue as to whether such recovery was lawful or not. Further, it was also a point of determination as to whether if at all the recovery was [2024:RJJD:52966-DB] (18 of 19) [CW-16982/2019] required, under which provisions the same can be made. This is more so when the record reveals that the revenue has not been able to point out any such provision. The learned CESTAT in such circumstances should have remanded the matter back to the Commissioner for passing appropriate orders pertaining to recovery in question under the relevant provisions, if any, which it has missed out. 20.1. Rather than resorting to the above-said exercise under appeal, though the learned CESTAT did not disagree on the aspect of demand but recorded its opinion that there is no provision to satisfy such demand in the form of recovery of cost recovery charges. 21. Thus, in light of the aforesaid observations, the instant appeals are allowed, accordingly the impugned orders dated 26.07.2019, passed by the lear....
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....e payments at such rates and in the manner specified by the Government of India in the Ministry of Finance unless specifically exempted by an order of the said Ministry; I also find the conditions from the exemption from the payment of Cost Recovery Charges as laid down at 8.5 (f) of Circular No. 02/2021- Customs dated 19.01.2021, which is reproduced as under: 8.5 f. the payment of Cost Recovery Charges would be up-to-date; From the above provisions of HCCAR, 2009, it is clear that till any specific order of the Ministry, exemption from the payment of Cost recovery Charges cannot be granted to M/s TDP. 34. In view of above discussion, I find that the TDP is liable to pay cost of recovery charges along with applicable interest and hence, I confirm the demand of cost recovery charges of Rs.1,66,35,585/- (Rupees One Crore Sixty Six Lakh Thirty Five Thousand Five Hundred and Eighty Five only) for the period 01.01.2018 to 30.11.2011 and Rs. 13,99,26,317/-(Thirteen Crore Ninety Nine Lakh Twenty Six Thousand Three Hundred Seventeen only) for the period 01.12.2018 to 31.12.2023 along with applicable interest. I order for recovery of the same from M/s TDP....
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.... Commissionerate to support his claim; (vi) The Cost Recovery Charges were required to be apportioned wherever the officers were posted at the ICD and the Commissionerate; (vii) No transport allowance could have been added to the Cost Recovery Charges as the officers had been provided with transportation services by the appellant; and (viii) No recovery can be made under 2009 Regulations as there is no provision for recovery of arrears of Cost Recovery Charges. In other words, there is no power to make recovery of arrears of Cost Recovery Charges. 16. Shri Nikhil Mohan Goyal, learned authorized representative appearing for the department submitted that against the order of the Telangana High Court in GMR, the department has filed an appeal before the Supreme Court and notice has been issued. Learned authorized representative appearing for the department also submitted that there is no error in the order dated 11.04.2025 passed by the Principal Commissioner which may call for interference in this appeal. 17. The submissions advanced by the learned counsel for the appellant and the learned authorized representative appearing for the department have be....
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....e ultra vires the Customs Act, 1962. 25. For the aforementioned reasons, we agree with the conclusion of the learned Single Judge that the impugned 2009 Regulations are ultra vires the Customs Act." (emphasis supplied) 19. A Division Bench of this Tribunal in CMA CGM Logistics Park Dadri- Private Limited vs. Commissioner of Customs, Noida [Customs Appeal No. 70764 of 2025 decided on 11.11.2025] also examined this issue of cost recovery charges and in view of the decision of the Telangana High Court in GMR held: "11. **** However, we find that the Andhra Pradesh High Court in GMR International has completely overruled the levy of cost recovery charges by the department by holding the Regulations as ultra vires the provisions of the Customs Act under section 141 and 157. The High Court has categorically observed that there is no express statutory provision conferring authority on the appellant to levy CRC and in the absence of any special authorization to recover charges, the department have no authority to impose CRC by means of Regulations. Once the Regulations have been held to be ultravires, the impugned order passed by the Commissioner is unsustaina....