Section 123(4)(a) in The Naval Ceremonial, Conditions Of Service And Miscellaneous Regulations, 1964
(a)Cadets(i)Cadets who fail in the Cadet's Passing Out Examination shall normally be put back a term and then re-examined. Relegation of a term as a cadet shall entail loss of six months seniority for promotion to Midshipman.(ii)A second failure in examination shall entail liability to discharge from the Service.