JUDGMENT
M.L. Pendse, J.
1. The petitioners are partnership firms and sole proprietary concerns carrying on business as importers and exports of pearls. The petitioners import raw pearls, which are then polished and strung and finished pearls are exported. Prior to June, 1985, consignments of imported pearls were delivered at Bombay through air freight/cargo and were cleared by the Customs Authorities through the Jewellery Section of the Air-cargo Complex at Sahar Airport. On receipt of intimation, the consignee used to present relevant documents to the Customs Authorities and the consignment was appraised and if found to be in order, the same was released by the Customs Authorities. The consignee was required to pay handling charges fixed by the Customs Authorities for such clearance and these charges were irrespective of weight and dimension of the package. Prior to February 1985, the said system was also followed in respect of consignment of pearls meant for export. The consignor was required to pay shipping bills in duplicate alongwith invoice and other documents and present it to the Customs Authorities. After the Customs Authorities were satisfied with the export order, permission was granted. The Customs Authorities used to levy charges in accordance with the Regulations.
2. Section 8 of the Customs Act 1962 inter alia provides that the Collector of Customs may approve proper places in any Customs port or Customs airport or Coastal port for the unloading and loading of goods or for any class of goods. Section 45(1) of the Act provides that all imparted goods unloaded in a customs area shall remain in the custody of such person as may be approved by the Collector of Customs until they are cleared for home consumption or are warehoused or are transhipped in accordance with the provisions of Chapter VIII. Sub-section 2(b) of Section 45 provides that a person who is in custody of imported goods shall not permit such goods to be removed from the customs area except under and in accordance with the permission in writing of the proper officer. Section 156 of the Act confers power upon the Central Government to frame rules while Section 157 confers power upon the Board to make regulations consistent with the Act and the rules to carry out the purposes of the Act. Section 158 demands that all rules and regulations made under this Act shall be published in the Official Gazette. Sub-section 2(i) of Section 158 inter alia confers power upon the Board to make regulation to provide for the levy of fees in respect of applications, amendment of documents, furnishing of duplicates of documents, issue of certificates and supply of statistics and for rendering of any services by officers of customs under the Act. The expression ‘Board’ is defined under Section 2(6) of the Act and means the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963.
In exercise of powers conferred by Sections 157 and 158 of the Customs Act, the Central Board of Excise and Customs has framed regulations known as Customs (Fees for Rendering Services by Customs Officers) Regulations 1968. Regulation 3 provides for levy of fees for rendering of services and Regulation 3(1) provides that a fee as specified in the table shall be levied for the rendering of services under the Act by any of the customs officers enumerated in column (1) of the table. The table sets out that the Appraisers, Preventive Inspectors and Superintendents of Central Excise shall charge fees for rendering of services in accordance with the rates prescribed. The fees very from Rs. 11/- to Rs. 22/-. The fees for services rendered between 8.00 p.m. and 6.00 a.m. and on Sunday and other holidays are more than the services rendered on regular days. It is not in dispute that the rates set out in table are amended from time to time.
3. The Collector of Customs; Bombay by Notification dated November 22, 1984 issued in exercise of powers conferred under Section 8 of the Customs Act, specified the premises of Respondent No. 3 situated on 2nd floor, Diamond Plaza Building, Dr. Dadasaheb Bhadkamkar Marg (Lamington Road), Bombay-4 as the customs area for the purposes of storage and clearance of imported and exported cargo of diamonds, precious and semi-precious stones, pearls, jewellery made of gold or any other precious metal. Respondent No. 3 is a Company incorporated under the provisions of the Companies Act and a Government of India Undertaking. The Gem and Jewellery Export Promotion Council had suggested to the Central Government that the clearance of imported and exported jewellery and other precious metals should not be at the Air Cargo Complex at Sahar Airport but at the Diamond Bourse, established by Respondent No. 4 Company. The Respondent No. 4 is a Company incorporated under the provisions of the Companies Act with the object of establishing a bourse for the promotion of exports of diamonds from India and to provide infrastructure and other facilities for Indian and overseas buyers and sellers of diamonds. Respondent No. 4 – Bharat diamond Bourse is established on August 18, 1984 and was promoted by 16 members out of which 14 were prominent diamond exporters and the remaining two were office bearers of Respondent No. 3 Corporation. The Respondent No. 4 Bourse was intended exclusively for promotion of cut and polished diamonds and the membership of the Bourse was confined to diamond trade. The Gem and Jewellery Export Promotion Council, a body set up by Government of India, made repeated representations of the Government, Ministry of Commerce and to the Customs Authorities and the Respondent No. 3 to agree to clearance of all jewellery items including diamonds, pearls, gold jewellery etc. at the Customs Clearance Centre in the Bourse premises. The Government of India enquired from Respondent No. 3 and gave approval and thereafter, Respondent No. 3 asked the Collector of Customs, Bombay to issue Notification specifying the premises of the Bourse as the customs area.
By notices dated June 1, 1985 and July 19, 1984 the Respondent No. 3 stipulated the rates of service charges on parcels cleared at Diamond Plaza Customs Clearance Centre, both for import and export parcels. Different rates are provided for members of the Bourse and non-members. In respect of import, the fee for members is Rs. 150/- upto 5 kgs. and Rs. 20/- per additional kg., while for non-members Rs. 225/- upto 5 kgs. and Rs. 20/- per additional kg. Subsequently, the rates were reduced.
4. By this petition filed under Article 226 of the Constitution on October 5, 1985 the petitioners are challenging the action of Respondent No. 3 in demanding fees which are in excess of those specified by table annexed to the Customs (Fees for Rendering Services by Customs Officer) Regulations, 1968. The gravamen of the complaint of the petitioners is that the rates for services rendered by the customs officers are set out under the table and merely because the Respondent No. 3 is a person in whose custody the imported goods remain till clearance for home consumption, it is not permissible to charge fees which are in excess of fees set out in the table. The respondents do not dispute that the fees levied in respect of the services rendered are in excess of the fees set out in the table. The Respondent No. 3 Corporation has filed return sworn by Bhalchandra S. Kanugo, Chief Executive and Custodian, and it is claimed that the fees in excess of what is provided in the table are recovered because additional services are rendered. The Respondent No. 3 claims that the additional charges are required to meet the expenditure plus cost of transportation and security in bringing the customs cleared import parcels from Sahar Air Cargo Complex to the city. The Respondent No. 3 also claims that the rent of the premises where Bourse is situated is required to be paid and the deposit of Rs. 60,00,000/- was kept for the lease of the premises. The Respondent No. 3 is also required to provide for security arrangements at the Bourse. The Respondent No. 3 claims that the facilities available with the Bourse can be availed of by the trade only at a cost and the members will be required to pay the actual expenses incurred for carrying the goods from the Centre to the city. The Respondent No. 3 further claims that the pearl imports were hardly 0.8 – 1.2% of the total imports and the pearl exports constituted only 0.46.55% of the total exports for the years 1984 and 1985. The Respondent No. 4 has filed return sworn by S. G. Jhaveri, Vice President and the contentions raised by Respondent No. 3 are reiterated.
5. Shri Vahanwati, learned counsel appearing on behalf of the petitioners, submitted that it is not permissible for an authority appointed under Section 45 of the Customs Act to levy and recover fees which are in excess of those set out in the table annexed to the Customs (Fees for Rendering Services by Customs Officers) Regulations 1968. Shri Vahanwati submitted that the Respondent No. 2 had power to specify the premises of Bourse as the approved place for loading and unloading of goods for customs clearance. Shri Vahanwati admitted that under Section 45 of the Customs Act, it is open for the Collector of Customs to specify that Respondent No. 3 will be the person having custody of the imported goods. The entire controversy centres around the issue as the whether it is open for Respondent No. 3 to prescribe that the fees which will be charged for services to be rendered under the Act, need not be in accordance with the fees set out in the table annexed to the Regulations, but what Respondent No. 3 finds to be a [sic] reasonable fees. Shri Vahanwati submits and in our judgment, with considerable merit that merely because the Collector of Customs delegates the authority of clearance of the goods to Respondent No. 3, the Respondent No. 3 cannot dictate as to what fees will be charged for service to be rendered under the Act. Section 158(2)(i) confers power upon the Board to provide for levy of fees for rendering any services by officers of customs under the Act. The Board had framed the Regulations and determined the rates of fees to be charged for rendering of services. It is open for Respondent No. 2 to appoint Respondent No. 3 as the authority to render the services at the place of Respondent No. 4 but Respondent No. 3 cannot charge fees which are in excess of those prescribed by the Board in accordance with the Regulations framed under Section 157 of the Act. Shri Thakkar, learned counsel appearing on behalf of Respondent No. 3, submitted that it is open for the Board to provide by Regulations, rates of fees for rendering of services under the Act but such Regulations will not bind Respondent No. 3. We are unable to find any merit in the submission. The services rendered by Respondent No. 3 are those to be performed under the Act and the mere fact that the Collector of Customs has delegated the duty of rendering services to Respondent No. 3 cannot entitle the Respondent No. 3 to demand charges which are in excess of those set out in the table. Shri Thakkar submitted that the petitioners are not bound to demand the services from Respondent No. 3. The submission overlooks that once the Collector of Customs designates the Bourse as the Customs area where the clearances will be carried out, then the petitioners will have no option but to secure such services at such Bourse from Respondent No. 3. Shri Thakkar urged that the Respondent No. 3 is rendering beneficial services and the Respondent No. 3 has no desire to render services if the fees are to be charged only in accordance with the rates set out in the table. It is not for Respondent No. 3 to take such a decision but for the Respondent Nos. 1 and 2 who had delegated powers to Respondent No. 3 in accordance with Section 45 of the Customs Act. It is open for the Central Government and the Collector of Customs to provide any other clearance stations, in case the Respondent No. 3 has no desire to render services to the petitioners, only on the ground that the business carried out by the petitioners is of a negligible percentage to that carried out by the diamond importers and exporters. In our judgment, it is not open for Respondent No. 3 to levy or recover fees in excess of those set out in the table annexed to the Regulations and consequently, the petitioners are entitled to relief.
6. Accordingly, petition succeeds and the Respondent Nos. 3 and 4 are directed to render services by levy and recovery of fees as set out in the table annexed to the Customs (Fees for Rendering Services by Customs Officers) Regulations, 1968 and not to charge any amount in excess thereof. The Respondent No. 3 is entitled to charge the fees set out in the table as modified from time to time. The Respondent No. 3 shall pay the costs of the petitioners.
7. Shri Vahanwati submitted that in pursuance of the judgment dated January 16, 1986 delivered by Division Bench of this Court in Appeal No. 17 of 1986, the petitioners were directed to deposit the difference between the fees prescribed in the table and those demanded by the Respondent No. 3 with the Prothonotary and Senior Master of this Court. In accordance with the direction, diverse amounts have been deposited from time to time and the Prothonotary and Senior Master had invested those amounts with nationalised banks. Shri Vahanwati submitted that as the petitioners have succeeded in the challenge to recovery of excess fees, directions may be given that the amounts deposited by the petitioners should be refunded by the Prothonotary and Senior Master. The prayer is just and is required to be granted. Accordingly, the Prothonotary and Senior Master is directed to refund the amounts deposited by the petitioners forthwith alongwith the interest accrued if any. Shri Thakkar applies for stay of operation of the order. Prayer refused.