The collection of development fee (DF) at the Delhi airport from December 1, 2011, is already embroiled in a controversy as the legality of the AERA decision to allow it has been challenged by lawmakers in Parliament.
"The suggestion made by the Ministry of Consumer Affairs is against the Airport Authority of India and Airport Economic Regulatory Authority (AERA) and goes against the spirit of the judgement of the Supreme Court," Civil Aviation Secretary Nasim Zaidi said in a letter to the Consumer Affairs Ministry.
On December 8 last year, the Consumer Affairs Ministry had recommended that the AERA credit DF already collected to the Consumer Welfare Fund (CWF).
Regarding the collection of DF, the Supreme Court held it was necessary to ensure that the DF levied and collected is utilised only for funding or financing the cost of upgradation, expansion or development of airports, Zaidi said.
The AERA had allowed GMR-led Delhi International Airport Limited (DIAL) to collect Rs 1,300 per international passenger and Rs 200 from each domestic passenger as DF from December 1.
The DF collected was being deposited in escrow accounts over which the Airports Authority of India and the government had powers to ensure that all receipts were properly accounted for and utilised only for "the permitted purposes of airport development".
As per an estimate tabled in the Rajya Sabha, Rs 1,481.72 crore was collected as DF before the regulator gave formal approval to DIAL in this regard.
In 2009, DF collection at Delhi and Mumbai airports was upheld by the Delhi High Court. However, it was quashed by the Supreme Court in April last year, with the apex court directing AERA to pass appropriate orders for its collection.
The AERA had then allowed to DIAL to start collecting DF from December 1.
However, the AERA order was challenged in the Rajya Sabha by the BJP and CPI(M), with CPI(M) MP K N Balagopal saying it was "illegal" as necessary amendments to the rules governing DF had not been passed by Parliament, though it was on its agenda.
A Statutory Motion listed in the Rajya Sabha`s agenda in the just-concluded Winter Session could not be taken up.