- (1.) This batch of cases raises questions relating to interpretation of Regulations 8 and 9 of the Customs House Agents Licensing Regulations, 1984 (hereinafter called 'the Regulations') made by the Central Board of Excise and Customs under sub-section (2) of section 146 of the Customs Act, 1962. In the Writ Petitions filed under Article 32 of the Constitution, the petitioners have questioned the constitutional validity of the aforesaid Regulations which enjoin the securing of at least 50 marks out of 100 for the oral test on the ground that it gives arbitrary powers to the authorities to pick and choose the candidates. This contention is based on this Court's decision in Ajay Hasia v. Khalid Mujib Sehravardi, (1981) 2 SCR 79 : (AIR 198I SC 487). Before we state the factual background it may be advantageous to read the relevant Regulations.
(2.) Regulation 2 defines the various expressions used in the Regulations. The expression "Customs House Agent" means a person licensed under the Regulations to act as agent for the transaction of any business relating to the entry or departure of conveyance or the import or export of goods at any customs station. Regulation 4 provides for inviting applications for the grant of a licence to act as a Customs House Agent. It says that the Collector may invite applications in the month of January every year for clearance work within the jurisdiction of the said collectorate. Regulation 5 prescribes the form in which the application shall be made. It is clear from this Regulation that the application can be in the name of an individual, a partnership firm or a company incorporated under the Companies Act. Regulation 6 lays down the conditions to be fulfilled by the applicant. One of the conditions to be satisfied is that the applicant has the experience of work relating to clearance of goods through the customs for a period of not less than one year and is financially viable. That brings us to Regulations 8 and 9 which we extract for ready reference : "8. Grant of temporary licence.- Any applicant whose application is received within the last date specified in Regn. 4 and who satisfied the requirements of Regns. 5 and 6, shall be permitted to operate as Custom House Agent at the customs station for which the application is made initially for the period of one year against temporary licence granted by the Collector in this regard in Form B : Provided that when evidence is produced to the Collector that the applicant has already availed of two chances for qualifying in the written or oral examination prescribed in these regulations and would like to avail of the third chance as soon as the next examination is held in terms of Regn. 9 and that the applicant has been able to account for the minimum volume of work prescribed for such agents in the course of one year's working, the Collector may extend the aforesaid period of one year for which the temporary licence has been granted by another six months or such further period not exceeding one year to enable the applicant to avail of the third chance for qualifying in the examination in terms of Regn. 9. While granting such extension, the Collector of Customs shall satisfy himself that the requirements of Regns. 10(1)(a) and 10(1)(b) had been fully met by the applicant. 9. Examination of the applicant.-(1) The holder of a temporary licence in the case of an individual and the person or persons who will be actually engaged in the work of clearance of goods through customs on behalf of the firm or company holding a temporary licence, as the case may be, shall be required to qualify in examination at the earliest opportunity. Such person or persons shall be eligible to appear in the examination as soon as a temporary licence is granted and shall be permitted to avail of three chances within a period of 2 years from the date of issue of the temporary licence on payment of prescribed examination fee of Rs. 250 for each examination. (2) The examination referred to in sub-regulation (1) shall include a written and oral examination and will be conducted twice every year. Each applicant would be permitted to avail of maximum of three chances to qualify in the said examination but all such chances should be availed of within a maximum period of 2 years from the date of grant of temporary licence. (3) to (4) x x x x x x x x x x x x x". Regulation 10 provides for the grant of a regular licence. Regulation 10(3) says that the Collector may reject the application for the grant of a regular licence to act as Custom House Agent if the holder of the temporary licence fails to qualify in the examination in terms of Regulation 9, or the holder of temporary licence on evaluation of his performance in terms of Regulation 10 is not considered suitable due to any other reason to be stated in the order passed by the Collector.
(3.) It is crystal clear on a plain reading of the Regulations that any individual firm or company can apply for a licence if the applicant fulfils the conditions laid down in Regulation 6. Under Regulation 8 before a regular licence is issued, a temporary licence may be issued to a person who satisfies the requirements of Regulations 5 and 6 to operate as a Custom House Agent initially for a period of one year. During this period of one year he is required to qualify by passing both the written and oral examinations within two chances but if he has failed to do so and is desirous of availing of a third chance as soon as the next examination is held, the Collector may extend the period by another six months or such period not exceeding one year to enable the applicant to avail of the additional chance to clear the examination. In other words, ordinarily the applicant must qualify within the initial period of one year but if he fails to do so the Collector may extend the time by a maximum of one year to give the applicant an additional chance but in no case can the temporary licence be renewed beyond two years. The Regulations are silent on the question whether the applicant must first clear the written test to qualify for the oral test. The High Court has, however, noted as a fact which has not been controverted before us that "the candidates are not allowed to appear for an oral examination unless they have passed the written examination". Each examination is of 100 marks, the passing marks being 50. Now under Regulation 8 since a candidate is ordinarily required to qualify within two chances in a year if the examination is held twice in one year and if he cannot appear for the oral examination unless he has passed the written examination, it follows that he will have only one chance for the oral examination even if he clears the written examination at the first attempt unless the oral test is held after the result of the written test is announced. It is, therefore, obvious that in the first year under Regulation 8(1) the candidate may not have two chances to appear for the oral examination. If he does not pass the written examination at the first attempt immediately after he has secured a temporary licence he would not get a single chance to appear for the oral examination in the first year unless the oral test is held after the result of the written test within that year. Therefore; when the proviso to Regulation 8(1) talks of the third chance it may perhaps be true for those who passed the written test at the first available opportunity but not for those who failed to do so. It was, therefore, contended by the learned counsel for the petitioners that the third chance contemplated by the proviso would not be available to candidates who do not pass the written test at the first attempt in the year in which they are granted the temporary licence and two examinations are held in that very year. They, therefore, contend that the third chance contemplated by the proviso would not be available to those who pass the written examination at the second or the third attempt. For them, they contend, the proviso should be so construed as to give them the third chance to appear at the oral examination also.;