Protection Is a Licensed Trade: what Indian law asks of a security agency, and of the client who hires one

Who needs a licence

The Private Security Agencies (Regulation) Act, 2005, usually called PSARA, has been in force since 14 March 2006. Section 4 bars any person from carrying on the business of a private security agency without a licence [1]. Private security is security provided by anyone other than a public servant to protect or guard a person, property or both, and it includes armoured car services. An agency is any person or body, other than a government one, in the business of providing private security, training guards or supervisors, or supplying guards to a company or to any other person or property [1]. On that wording residential guarding, personal protection and event security all fall inside.

On the same wording a household that employs its own watchman directly is not an agency, though we found no ruling on the point. An event manager, concierge firm or consultant who supplies guards as part of a package may itself be carrying on the licensed business, so the safer course is for the guarding contract to be signed by the licence holder.

Licences are issued by each state's Controlling Authority, an officer of at least Joint Secretary rank in the Home Department or an equivalent officer, and name the districts or the state they cover [1][2]. A Maharashtra licence does not cover Goa, and an agency may not provide security abroad without the Controlling Authority's permission [1].

Applicants are screened for convictions and for foreign ownership: a company, firm or association is ineligible if it is not registered in India, or if it has a proprietor, majority shareholder, partner or director who is not an Indian citizen [1]. A licence runs for five years. Renewal must be applied for at least forty-five days before expiry, and under the central model rules an agency that misses that window is treated as unlicensed once the licence lapses [1][2].

Carrying on the business without a licence is punishable with imprisonment of up to one year, a fine of up to ₹25,000, or both [1]. The Act creates no separate offence for the client, who is left with a supplier no regulator has vetted.

What changed in May 2026

The Jan Vishwas (Amendment of Provisions) Act, 2026 received assent on 7 April 2026 and removed two provisions of PSARA: section 12, which required an agency to exhibit its licence at its place of business, and section 20(2), which set a fine of up to ₹25,000 for breaches of section 12 and of sections 9 and 10 on training, supervisors and guard eligibility [1][3]. The Ministry of Home Affairs brought the change into force on 15 May 2026 [4]. A breach of sections 9 or 10 no longer attracts that fine, but it remains a ground for cancelling the licence under section 13 [1]. The central model rules still say an agency is bound to display its licence at its place of business, and a state's rules may say the same [2]. In either case, ask for a copy and read the dates.

What the rules require of guards and supervisors

An agency may employ as a guard only an Indian citizen (or a citizen of another country the Centre has notified) aged eighteen or over and under sixty-five, with verified character and antecedents, the prescribed training and the prescribed physical standards. Anyone convicted by a competent court, or dismissed or removed for misconduct or moral turpitude from the armed forces, the police, government service or another agency, is barred [1].

The Centre's current model rules are dated 15 December 2020. States must conform to them as far as practicable when they make their own rules, so the figures vary by state [1][2].

Ex-servicemen and former police take a condensed course of at least 40 classroom and 16 field hours under both sets [2][5]. We could not confirm whether Maharashtra has revised these figures since the 2020 model rules.

The model rules set one entry-level course, with firearms handling optional, and no separate qualification for a personal protection officer [2]. Any close protection skill beyond that course is the agency's own standard, and the buyer has to test it. Under the model rules a trained guard holds a training certificate in Form VIII and a character and antecedents certificate in Form VII, wears a photo identity card in Form XI on duty, and has a medical examination every twelve months. State rules may number the forms differently [2][5].

The Act binds guards to confidentiality about their assignments, but the duty runs to the employer, so a client's own confidentiality terms belong in the contract [1].

Maharashtra's second regime

Maharashtra has an older law that sits beside PSARA. The Maharashtra Private Security Guards (Regulation of Employment and Welfare) Act, 1981 applies to guards who work in a factory or establishment without being its direct employees. It began in Greater Bombay and Thane district on 29 June 1981 and reaches other areas by notification [6]. Under the Act and its 2002 Scheme, a Security Guards Board registers guards and principal employers. A registered principal employer takes guards from the Board, employs its own directly, or uses the guards of an agency registered with the Board, whom the state has exempted under section 23 because their benefits are, on the whole, no less favourable than those under the Act and the Scheme [6][7].

The specimen exemption notification on the Board's website, dated 9 June 2016, runs for three years and names both the guards and the principal employer. It makes a PSARA licence compulsory for the agency, requires the principal employer to register with the Board within fifteen days, and holds the principal employer responsible for the guards receiving wages and benefits no less favourable than the Scheme's [8].

An amending Act published on 28 April 2025 ties the 1981 Act's definition of establishment to the state's 2017 shops and establishments law [9]. Whether a residence or a family office qualifies is a question for a labour lawyer.

What a guard may and may not do

PSARA gives a guard no power of arrest, search or detention. If he notices a breach of law while on duty he must report it to his superior, who must inform the police, and an agency that lets its people pass as public servants can lose its licence [1].

In law a private security guard has no more power than any other private person. Any force he uses has to be justified the way anyone else's would be.

The justification is the right of private defence in the Bharatiya Nyaya Sanhita, 2023. Section 35 gives every person the right to defend his own body "and the body of any other person" against offences affecting the human body, and to defend property, his own or another's, against theft, robbery, mischief or criminal trespass. A protection officer shielding a principal relies on that right. Section 37 restricts it, and two of its limits bear directly on protection work: there is no right of private defence where there is time to have recourse to the public authorities, and the right never extends to inflicting more harm than the defence requires. The right to cause death is confined to listed cases, among them an assault that reasonably causes fear of death or grievous hurt, robbery, and house-breaking after sunset and before sunrise. For theft, mischief or criminal trespass outside those cases the defender may cause harm short of death [10].

Under section 40 of the Bharatiya Nagarik Suraksha Sanhita, 2023, any private person may arrest someone who commits a non-bailable and cognizable offence in his presence, or a proclaimed offender, and must hand that person to the police without unnecessary delay and within six hours [11]. A guard has that power and no wider one. Since PSARA gives no power to search, a bag check at a gate depends on the visitor agreeing to it.

Firearms

A PSARA licence is not an arms licence. The Arms Act, 1959 forbids anyone to acquire, possess or carry a firearm without a licence and limits a person to two firearms. Someone without a licence may carry the weapon only in the holder's presence or under his written authority, and only for repair, for renewal of the licence, or for use by the holder [12]. On that wording a licence holder cannot hand his pistol to a guard for the guard to use. The Ministry of Home Affairs says the Arms Rules, 2016 withdrew the provision that let individuals appoint retainers [13].

Companies are treated differently. A licence granted to a company to protect its premises or property is issued in the name of a responsible person, and each employee entrusted with the weapon is entered as a retainer and given a permit in Form III-B after a police report on his antecedents [14]. The rule speaks of guarding the company's own premises or property and does not address an agency's guards posted at a client's site. An undated FICCI note on cash logistics recorded that agencies had in practice hired guards who held licences in their own names, and that police in some states had treated this as misuse of a personal licence [15]. We found no current Ministry of Home Affairs circular that settles the point.

In a public place a firearm must be carried in a holster or holder and completely covered. Brandishing or firing it there is prohibited, and a breach can cost the licence and the weapon [13][14].

Moving cash and valuables

In 2018 the Centre issued model rules for agencies that secure bank cash in transit. They require a PSARA licence, a purpose-built van with GPS tracking, and a crew of at least one driver, two armed guards and two custodians. A van may carry no more than ₹5 crore a trip, and a secured van is required above ₹10 lakh. Movement stops at 9 pm in urban areas and 6 pm in rural areas. Crew need police clearance and a credit history check, and the agency must hold fidelity insurance for them [16]. Maharashtra issued its own version on 29 April 2025, to take effect six months after publication in the Gazette [17].

The model rules define cash transportation to include other items of value, but their contracting provisions speak only of banks, and we could not confirm that they bind a private consignment of jewellery, art or event takings [16]. They are the only published standard we found.

Labour duties that reach the client

The four labour codes took effect on 21 November 2025 [18]. Under section 55 of the Occupational Safety, Health and Working Conditions Code, 2020, if a contractor fails to pay wages or pays short, the principal employer must pay the workers and may recover the sum from the contractor. That part of the Code applies only to establishments where fifty or more contract workers are employed, or were on any day in the preceding twelve months [19]. Section 43 of the Code on Wages, 2019 adds that where an employer fails to pay what the Code requires, the company, firm or other person who is the proprietor of the establishment in which the employee is employed is responsible for the payment [20]. The Centre notified its rules under the codes in May 2026 and each state frames its own, so check which are in force in yours [21].

Violating any of the nine labour Acts in PSARA's Schedule is a ground for cancelling an agency's licence. All nine have since been consolidated into the codes, though the Schedule in the current published text still names the old Acts [1][22][23]. Under the model rules an agency's register records each guard's salary, ESI and provident fund numbers and the bank through which he is paid [2]. A client can reasonably ask to see those records for the guards on its site.

Where this desk stands

ARKA's Close Protection desk holds no PSARA licence. It plans and coordinates, and protection details are delivered only by PSARA-licensed agencies, engaged for each mandate.

What to do with this

Before signing, ask the agency for:

• The PSARA licence for the state where the detail will work. Match the name to the contracting party and check the districts and the expiry date. If expiry is less than forty-five days away, ask for proof of the renewal application [1][2].
• In Maharashtra, for an office or other establishment: the section 23 exemption notification naming your guards and you as principal employer, and confirmation of your own registration with the Board [7][8].
• For each guard and supervisor: the photo identity card, the training certificate, the dated character and antecedents certificate and the last annual medical, with the number of guards and sites each supervisor covers [2].
• For any armed role: the arms licence for each weapon, showing the holder, the area of validity and the expiry, and the Form III-B permit where the weapon is on a company licence [12][14]. Take legal advice before an armed deployment.
• Provident fund and ESI registration, with monthly proof of remittance and wage payment for the guards on your site [2][19].
• A written statement of any criminal case pending against the agency or its directors, and of any suspension of its licence [1][2].
• For cash or valuables: the vehicle, crew, insurance and timings, measured against the cash transportation rules [16].
• Contract terms the statutes do not supply: confidentiality owed to you, a use-of-force policy within the limits above, and no substitution of guards without the same paperwork.