Hi Satish,
You are correct that Custom Controller comes into picture or can be brought into picture when you don't want to put your code in Component Controller and making it bulky in terms of coding...
it also increases the Initialization time for the application.
The only difference that I see in Custom Controller and component Controller is that Custom Controller do not have Interface Methods It means Methods which are defined in this Custom Controller can only be used with in the View in which this Custom Controller is added using "Used Controllers/Components" option. There could be more then one Custom Controller in WD Component but there could only be one Component Controller.
You can write reusable code using Custom Controller which you want to use in specific Views (say in 2 Views out of 5) by using this CC in those 2 View.
"Please correct me if I am wrong on above line".
Custom Controllers are also used when a set of Views to perform some special function or to hold the data.
Hope this helps-
Thanks-
Abhishek