FEDERATION OF CUSTOMS HOUSE AGENTS ASSOCIATION AND ORS. ETC. vs. UNION OF INDIA AND ORS. ETC. ETC.

CIVIL APPEAL No. 2632/1985Supreme Court1999 INSC 27615 July 1999Bench: 1 JudgeAuthor: S. SAGHIR AHMAD12 pages
AI SummaryDismissed

What did the Supreme Court hold?

The Supreme Court held that Regulation 8 of the Customs House Agents Licensing Regulations, 1984, is neither arbitrary nor ultra vires. The Court reasoned that these regulations were framed on the basis of recommendations made by the Committee on Subordinate Legislation. Furthermore, Regulation 8 was enacted in exercise of the powers conferred by Section 146(2) of the Customs Act, 1962, and Section 146(1) does not impose any restriction on the grant of temporary licenses. The Committee on Subordinate Legislation had recommended that temporary licenses be issued for a period of two years, with the applicant's performance being watched, and conversion to a permanent license contingent on satisfactory turnover and efficiency. The Court found that Regulation 8 incorporates proper checks and balances by considering both work experience and performance in qualifying examinations. The appeal was dismissed.

What were the facts?

The appellants, Federation of Customs House Agents Association and others, challenged the validity of the Customs House Agents Licensing Regulations, 1984 (1984 Regulations). They argued that Regulation 8 of these regulations, which allowed for the grant of temporary licenses without requiring applicants to pass an examination, was arbitrary. This contrasted with earlier regulations (1960 and 1965) that mandated passing an examination for a license. The High Court dismissed their writ petition. The appeal before the Supreme Court concerned the validity of these 1984 Regulations, specifically Regulation 8, which permitted individuals to act as Customs House Agents based on a temporary license for up to two years, without immediately passing a qualifying examination. The Union of India and others were the respondents.

What were the issues?

1. Whether Regulation 8 of the Customs House Agents Licensing Regulations, 1984, is arbitrary and violative of Article 14 of the Constitution of India, as it allows for the grant of temporary licenses without requiring applicants to pass a qualifying examination, unlike previous regulations. Assessee's Contention: The appellants argued that Regulation 8 was arbitrary because it permitted individuals to act as Customs House Agents based on a temporary license without their suitability and qualifications being tested, which was mandatory under earlier regulations. They contended that this allowed temporary licensees to operate at par with regular licensees who had passed the required examinations. Revenue's Contention: The judgment does not explicitly record separate contentions for the revenue beyond their implicit defense of the regulations' validity. However, the reasoning of the Tribunal indicates that the regulations were framed based on recommendations and provided for checks and balances.

Which sections of the Income-tax Act were involved?

Section 146, Section 146(2)

AI-generated summary — verify with the full judgment below

A B FEDERATION OF CUSTOMS HOUSE AGENTS ASSOCIATION AND ORS. ETC. v. UNION OF INDIA AND ORS. ETC. ETC. JULY 15, 1999 [N.P. SINGH AND S. SAGHIR AHMAD, JJ.] Customs House Agents Licensing Regulations, 1984-Regns. 2(C), 4, 5, 6, 8, 9 and 20---Customs House Agent-Validity of Regulation &-Grant of C temporary licence, without passing the examination specified by regula- tion~Regulations framed on the suggestion made by the Committee on Sub- ordinate-Legislation-Held, neither arbitrary nor violative of Sec. 146 of the Custom Act-<:ustoms Act, 1962 S. 146-<:onstiHltion of India, Art, 14. Under the Customs House Agents Licensing regulations, 1960 and D 1965 applicant had to appear in the examinations conducted for the selection of Custom House Agent and only selected candidate could get the licence for the Custom House Agent, But 1984 Regulation enable the to act as Custom House Agent, without passing such examination, on the basis of temporary licence granted to him by the Collector. On this licence he E can act as Custom House Agent for a period of one year as a matter of course and up to two years on the conditions prescribed by proviso to regulation 8 of 1984 Regulat

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