Temporary customs agent licensing under the Customs Act is valid when tied to experience, assessment, and later qualification.

Regulation 8 of the Customs House Agents Licensing Regulations, 1984 was upheld as a valid exercise of regulatory power under Section 146 of the Customs Act, 1962. The Court reasoned that Section 146 permits licensing regulations and does not bar a temporary licence before the prescribed examination is passed. Read with Regulations 6 and 20, the scheme linked temporary permission to prior experience, financial viability, practical work and later assessment. The Court also relied on the amended eligibility requirement introduced in 1991 tying access to relevant work experience. On that basis, the regulation was treated as a reasonable balance of experience and merit and not arbitrary or ultra vires.

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Issues: Whether Regulation 8 of the Customs House Agents Licensing Regulations, 1984, providing for grant of a temporary licence before qualification in the prescribed examination, was arbitrary, irrational or ultra vires Section 146 of the Customs Act, 1962.

Analysis: Section 146 empowers the framing of regulations governing licensing of customs house agents, and it does not prohibit the grant of a temporary licence pending qualification. Regulation 8 was read with Regulation 6, which requires prior experience and financial viability, and with Regulation 20, which links practical work and assessment. The Court noted that the regulation was consistent with the approach recommended by the Committee for Subordinate Legislation, namely that a temporary licence may be issued first and performance then watched before conversion into a permanent licence. The amendment introduced by Notification No. 74/91 (N.T)-Cus., dated 15-11-1991, further tied eligibility to relevant work experience. On that basis, the Court held that the provision balanced experience and merit and did not suffer from unconstitutionality or arbitrariness.

Conclusion: Regulation 8 was upheld as valid and not arbitrary or ultra vires.

Ratio Decidendi: A licensing regulation framed under Section 146 of the Customs Act, 1962 is valid if it reasonably permits temporary operation pending examination, provided it incorporates safeguards linking practical experience, suitability and eventual qualification.

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