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TMI Blog1993 (7) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... r temporary and as such the same was ultra vires. It was further contended that by the impugned regulation if the untrained persons are appointed as agents it would open a flood gate and that would create a good deal of complication and unequal would be treated as equal in this regard. There is no demand in the trade and as such this would take away the business which was being done by the existing permanent agents. It was further contended that regulation was not published in the Official Gazette and as such the same did not see the light of the day in the eye of law. It was further contended that no appointed date was fixed in this behalf as a consequence thereof the respondents have acted illegally in issuing a Public Notice on 9th April, 1984 inviting fresh applications on the basis of the new regulation. By the said notice dated 9th April, 1984, the applications were invited on the basis of the said regulation within 30th April, 1984. The said period had already expired. This writ application was pending for a long time with interim order of injunction. 4.It appears, however, that the learned Single Judge's attention was drawn on behalf of the added respondent to a Division ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the jurisdiction of the authority concerned to change the regulation and/or to repeal the regulation. So, it does not violate any of the provisions of Part III of the Constitution of India and/or it does not fall beyond the scope of the rule making power. By this regulation the petitioner's and the existing agent's right had not been taken away and/or interfered with. On the contrary, a scheme had been framed under which temporary licence could be granted to the applicant, who fulfils the conditions laid down in regulations 5 and 6 and a holder of a temporary licence can get a permanent licence if he could successfully pass at the examination. The petitioners are not affected at all by the regulation but the petitioners, it appears, intended to create a monopoly in the trade to the exclusion of new which has been described by the Delhi High Court as creating a kind of `close shop' which is on the face of it arbitrary and contrary to public policy. Accordingly, I hold that the petitioners have no locus standi to challenge the validity of the regulation concerned. I also fully agree with the decisions of the Delhi High Court cited by Mr. Bose." 7.While disposing of the said matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Forwarding Agent and during this period of 28 years only on two occasions the vacancies occurred and it was filled up by new licences. In the middle of 1983 although the volume of traffic was severely reduced, the number of licence holders increased in Calcutta by 13 and in Bombay by about 70 only to fill up the vacancies, caused by death, closure and/or suspension. 11.The Customs House Agents Licence Regulations, 1965 contained provisions for granting licence to an applicant for being Customs House Agent. The method of granting of such licence was generally to invite applications by the Collector of Customs by means of notice affixed on the Notice Board of the Customs House and also by advertisement through Press and there was a form in which the said application had to be made. For the purpose of making an application certain conditions had to be fulfilled by the applicant before the grant of licence which has been incorporated in Regulation 6 of the said Regulations. "Regulation 6. - Certain conditions to be fulfilled by the applicant before the grant of licence. - An applicant for a licence shall - furnish to the Collector of Customs satisfactory evidence as to his respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce remained valid for a period of one year and if in the meantime the licence holder was found to work satisfactorily, it may be extended and renewed for a period of 3 years and thereafter every year. The original licence would be granted on payment of a fee of Rs. 50/-. It has been submitted that before the licence is renewed, the Collector of Customs ought to satisfy himself about the financial solvency of the applicant and would require production of an Income-tax Clearance Certificate. Now, renewal of licence under the said Rules might be refused by the Collector of Customs if the minimum volume of business prescribed by the Assistant Collector of Customs in that behalf had not been transacted by the applicant as Customs House Agents during the period to which the licence relates and this licence was never transferable. 14.In 1966, the Government of India appointed a Customs Study Team under the Chairmanship of Shri Dwarkanath Tiwari, the observations and recommendations on the Clearing Agency System which have been accepted by the Government read as follows : The Customs Law and the Customs Procedure are matter of"9.13 detail and it has generally been found convenient both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... testing of knowledge etc." 15.That the drastic change made in the Regulations of 1984 is that an applicant shall be granted a licence by the Collector of Customs although the said applicant might not have possessed the professional or technical qualification necessary for carrying on the business of Clearing and Forwarding Agent in the Customs Station. In terms of the present regulation No. 6 the following conditions are to be fulfilled by the applicant : "The applicant or the persons referred to in clause (b) of sub-regulations (2) and (3) of Regulation 5, as the case may be, shall prove to the satisfaction of the Collector that he; has the experience of work relating to clearance of goods(a) through the customs for a period of not less than one year and the applicant has financial viability supported by a(b) certificate issued by a Scheduled Bank or such other proof acceptable to the Collector evidencing possession of assets of the value of not less than Rs. 1 lac in the case of applicants for the grant of licence in respect of any one of the Customs Stations at Bombay, Calcutta, Madras, Cochin, Kandla, Goa, Mangalore, Tuticorin or Visakhapatnam and not less than Rs. 50, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns, an applicant may be given a licence to carry on this trade and they had been placed on similar footing with the existing qualified licence holders and thereby unequals have been made equals which is not permissible under Article 14 and 19(1)(a)(6)(i) of the Constitution. 18.The holder of a temporary licence in the case of an individual and the person or persons who will be actually engaged in the clearance of goods through the Customs on behalf of a firm or a Company shall be required to qualify in examinations at the earliest opportunity. Such person or persons shall be eligible to appear in the examinations as soon as a temporary licence is granted and shall be permitted to avail of [three chances] within a period of two years from the date of issue of the said licence on payment of a fee of Rs. 250/- for such examination. The particular provisions of granting temporary licence to applicants who are not technically and professionally qualified to carry on that business have been given preference to the existing licence holders in contravention of Articles 14 and 19(i)(g) of the Constitution. The Regulations 8 and 9 therefore are ultra vires Articles 14 and 19 of the Constit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve to be vigilant in preventing them. It is no longer unknown to the people of India that in Bombay and Calcutta the unscrupulous people in Dock Area created an underground world of smuggling and corruption in which undesirable anti-socials are ruling. The respondents must, therefore, see that they do not issue licence to wrong type of persons and in the interests of revenue and more so in the interests of persons who employ licensed agents, these rules have been framed. Looking at the old rules it may be said generally that they were absolutely necessary though they were strict and their strictness would be felt only by the persons who are not otherwise dishonest. 23.In our opinion the regulations framed in 1984 providing for temporary licence will only allow persons who are not qualified to carry on specialized type of work involved in the performance of duty of a clearing agent. In the regulations of 1965 number of Licensees to be determined under regulations at a Customs House was controlled by the Collector of Customs having regard to the volume of import and export business transacted in that Customs House and the number to be required to handle those business was determine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Collector of Customs, Calcutta dated 12-4-1984, a public notice was given inviting applications from the intending applicants for the grant of licence in the Calcutta Customs House and it was further directed therein that the applications should reach the Customs House, Calcutta on or before 30-4-1984. In the said public notice, two conditions have been laid down for the satisfaction of the Collector of Customs. If the Collector of Customs is satisfied that the applicant (i) has the experience of work relating to clearance of goods through the Customs for a period of not less than one year and (ii) has financial viability supported by a scheduled bank or such proof acceptable to the Collector of Customs, Calcutta evidencing possession of assets of the value of not less than one lakh. 26.A certificate of experience can be procured by inducement, although he may have none in the matter from any person connected with this type of work and it is also not difficult to show the assets of Rs. 1,00,000/-, no matter if those assets had been earned by any unscrupulous means. 27.The Collector of Customs has no power and/or authority to exceed the directions given in the regulations o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... follows : With effect from such date as the Central Government(1) "202. may, by notification in the Official Gazette specify, no person shall act as an agent for the transaction of any business relating to the entrance or clearance of any vessel or the import or export of goods or baggage in any Custom House unless such person holds a licence granted in this behalf in accordance with the rules made under sub-section (2). The Chief Customs Authority may make rules for the purpose of(2) carrying out the provisions of this Section and in particular, such rules may provide for - the authority by which the licence may be granted under this(a) Section and the period of validity of any such licence; the form of the licence and the fees payable therefor;(b) the qualifications of persons who may apply for a(c) licence; the restrictions and conditions (including the furnishing of(d) a security by the licensee for his faithful behaviour as regards the Customs House regulations and officers) subject to which a licence may be granted; the circumstances in which a licence may be suspended or(e) revoked; and the appeals, if any, against an order of suspension or(f) revocation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt is not otherwise considered suitable. Objection is taken to cl. (c), it is said to confer a very wide discretion on the Customs-Collector, and reference is made to sub-rule (2) in which it is provided that no appeal shall lie from the order of the Customs-Collector rejecting an application. It is further pointed out that in July, 1960, the Rules were amended by the addition of Rule 25 under which an appeal is to lie to the Chief Customs Authority against every order of the Customs-Collector (i) rejecting an application for the renewal of a licence granted under these Rules; (ii) rejecting a fresh application made in accordance with Rule 17 and (iii) refusing the grant or renewal of a special temporary licence under Rule 24. It is argued that even though an appeal has been provided for these matters, no appeal has been provided for the rejection under Rule 10(1)(c). No doubt, other reasons may exist for rejecting the application of a candidate, as for example, when he is found to be a leper or an epileptic; but one would expect that an order of this kind would be backed by reasons to be recorded in writing. It must be remembered that there is first a scrutiny of the application a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e certiorari jurisdiction ex debito justitiae to get a `No Objection Certificate' granted under Rule 6 of the Bombay Cinema Rules 1954 by the District Magistrate in favour of a rival in the trade, brought up and quashed on the ground that it suffers from a defect of jurisdiction. 38.In order to have the locus standi to invoke certiorari jurisdiction, the petitioner should be an `aggrieved person' denotes an elastic, and, to an extent, an elusive concept. Its scope and meaning depends on diverse, variable factors such as the content and intent of the statute of which contravention is alleged, the specific circumstances of the case, the nature and extent of the petitioner's interest and the nature and extent of the prejudice or injury suffered by him. 39.The Bombay Cinemas Regulation Act, 1953 and the Bombay Cinema Rules 1954 are not designed to set norms of moral or professional conduct for the community at large or even section thereof. They only regulate the exercise of private rights of an individual to carry on a particular business on his property. In this context, the expression `person aggrieved' must receive a strict construction. 40.The Act and the Rules do not confer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n amended to do away the examination altogether. This is one of the ways in which others could have been allowed to enter the business. However, the alteration now is that a person can get a temporary licence for some period and then get a regular licence on passing the examination. We do not see how this infringes the Act and we also do not think that it infringes Article 14 of the Constitution. Learned Counsel says that it does infringe Article 14 because it makes unequals equal. We do not think that this is so. What the new regulations have actually done is to create a kind of apprenticeship for new entrants. They are not given regular licences but temporary licences which would enable them to get necessary experience and expertise to get regular licences. This type of procedure is not unknown. For instance, if you want a driving licence you can first get a learner's licence which enables you to drive a car so that you can get the necessary experience to get an ordinary driving licence. 44.With respect we are unable to agree with the aforesaid findings of the Division Bench of the Delhi High Court. Moreover, the said judgment has not taken into account the findings and observa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iciencies which are bound to lead to inefficient management and messing up the job for want of knowledge of the relevant laws and the job requirements. It is only by a system of licensing well on guards against the infiltration of persons of inadequate knowledge, technical as well as financial competence, that the interest of the trade can be protected and that in turn requires a strictly objective selection. 51.Given that it is necessary for the Customs House to have a disciplined and well regulated knowledgeable band of agents, there is no means of perceiving how a reckless system of issuing temporary licences can conduce to such objective. It is bound to produce such unwholesome results as make the entire licensing system nugated and judicrous. One would simply shudder if it is said that the quacks would be given temporary licences to practise as physicians as there is a dearth of qualified physicians. The system as obtaining in the Customs House in giving temporary licences to the agents has a simile to that situation. This system of temporary licensing is an irony when contrasted against the rigid standards of selection set forth for issuing the permanent licence. No permane ..... X X X X Extracts X X X X X X X X Extracts X X X X
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