Full Judgment Text
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PETITIONER:
STATE OF U.P. AND ANR.
Vs.
RESPONDENT:
RAJA RAM JAISWAL AND ANR-
DATE OF JUDGMENT29/04/1985
BENCH:
DESAI, D.A.
BENCH:
DESAI, D.A.
ERADI, V. BALAKRISHNA (J)
CITATION:
1985 AIR 1108 1985 SCR (3)1021
1985 SCC (3) 131 1985 SCALE (1)1248
ACT:
Constitution of India 1950, Article 226 Writ of
Mandamus-Issuance of-To statutory authority under a
licensing statute to grant a licence-Whether permissible.
U.P. Cinema (Regulation) Act, 1955, sections 3 and 5 &
U.P. Cinematograph Rules 1951 Rules 3 and 7.
Licence for location and construction of Cinema under
Rule 3-Licence for exhibition of films in cinema building
under section 3-Grant of-Determination of ’public interest’-
Stages of consideration-Explained.
Administrative Law Licensing powers-Indisputable
adjunct of controlled economy-Exercise in oppressive or
arbitrary manner-Avoidance of-Vigilance , by courts-
Necessity of.
Construction of Cinema theatre-Grant of licence-
Objection of Hindi Sahitya Sammelan-Refusal of Licence-
Whether Justified.
HEADNOTE:
The respondent desired to construct a cinema theatre on
a plot of land. He submitted an application under Rule 3 of
the U.P. Cinematograph Rules 1951 to the District
Magistrate, for obtaining a certificate signifying his
approval of the site selected for constructing a permanent
building to be used for cinematograph exhibition. The
District Magistrate as the licensing Authority issued a
public notice specifying the request of the respondent for
grant of a certificate and calling objections. An
organisation called the Hindi Sahitya Sammelan alone
submitted its objection, The District Magistrate referred
the application of the respondent to the State Government,
which directed the District Magistrate to carefully examine
the matter. The District Magistrate was of the opinion that
the Sammelan can neither be styled as an educational
institution nor a residential institution within the
contemplation or Rule 7(2)(b) because it was an institution
wedded to and working for the propagation of Hindi language,
and even though it may provide some research facility on its
campus it has no regular programme of class teaching, and
that having regard to all the
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relevant circumstances, the construction of a cinema
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building at the proposed site was not against public
interest. On the contrary, it was held that a modern
beautiful fully air-conditioned cinema building apart from
adding to the beautification of the city would enrich the
coffers of the State exchequer in the form of entertainment
tax. The District Magistrate granted the certificate
informed the respondent that construction of a cinema house
and be completed within two years from the date of the
issuance of the order. Chagrined by the grant of the
certificate, the Sammelan initiated action for acquisition
of the plot over which the cinema building was being
constructed, should under the Land Acquisition Act. The
respondent successfully assailed the acquisition order in
the High Court.
In the meantime as the period of two years specified in
the certificate issued under Rule 3 was about to expire, the
respondent moved an application for extension of time for
completion of the construction of cinema building, and
during the pendency of this application, the building was
completed.
The respondent made an application under section 3 of
the U.P. Cinema (Regulation) Act, 1955 for a licence to
exhibit films in the cinema building. The District
Magistrate refused to grant the licence. The respondent
preferred an appeal under Sec. 5(3) of the 1955 Act to the
State Government, which allowed the appeal and remitted the
matter to the District Magistrate with a direction to re-
examine the grounds on which he had refused to grant licence
to run the cinema in accordance with the rules and pass
suitable and legal order after giving an opportunity of
hearing.
Against the aforesaid order of remand the respondent
filed a Writ Petition in the High Court.A Division Bench
held that even though the order under challenge was one of
remand, as the respondent has journeyed to and fro on
numerous occasions, it was necessary to dispose of the
petition on merits, and held that while granting a
certificate under Rule 3 of the 1951 Rules, it was open to
the licensing authority to take into consideration whether
it would be in public interest to grant the necessary
certificate or to refuse the same, but after the grant of
certificate when a full-fledged cinema building comes up and
is shown to comply with the relevant rules and regulations,
cinematograph licence cannot be refused on the vague
consideration that it would not be in public interest to
grant the licence. It was also held that the failure to
complete the construction of the cinema building within the
prescribed time, if properly explained would not be a ground
to refuse the cinematograph licence, more so
because the requirement of rule 3(3) is directory and not
mandatory. The High Court accordingly made the rule absolute
and in modification of the order of the State Government, it
directed the District Magistrate-Licensing Authority to
forthwith grant to the petitioner the requisite licence
subject to reasonable condition and restrictions.
In the appeal to this Court it was contended on behalf
of the appellant state that the scheme o f the U.P. Cinema
(Regulation) Act, 1955 and the U.P.
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Cinematograph Rules 1951 reveal that the licensing authority
has to take into consideration public interest both at the
time of granting a certificate of approval as contemplated
by Rule 3 as also public interest while granting a cinema
licence under Sec. 3 read with See. 5, and that the High
Court was in error in holding that one while granting a
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certificate of approval under Rule 3, public interest has
been taken into consideration. The question of examining
whether such building should be licensed for exhibition of
cinematograph does not call for a re-examination whether the
grant is not otherwise contrary to public interest. Public
interest cannot be fitted into a straight jacket formula and
what relevant considerations would constitute public
interest at the time of granting a certificate of approval
under Rule 3 may materially vary or differ from the relevant
considerations which may constitute public interest while
licensing the cinema theatre for exhibition of a
cinematograph under See. 3.
Dismissing the appeal,
^
HELD: 1 The High Court was, clearly in error in issuing
a mandamus directing the District Magistrate to grant a
licence. The High Court was hearing a Writ Petition praying
for a Writ of Certiorari for quashing the order of removal.
The High Court should have quashed the order of remand if it
was satisfied that the order of suffers from an error
apparent on the record. But there its jurisdiction would
come to an end. The High Court cannot then proceed to take
over the functions of the licensing authority and direct the
licensing authority by a mandamus to grant a licence. To
that extent the judgment of the High Court is set aside.
[1040D,F]
2. Where a statute confers power and casts a duty to
perform any function before the power is exercised or the
function is performed, to the Court cannot in exercise of
writ jurisdiction supplant the licensing authority and take
upon itself the function of the licensing authority. [1040
E]
3. The High Court was in error in holding that once the
public interest has been taken into consideration while
granting certificate of approval, consideration of public
interest would not arise and cannot be countenanced while
granting a cinematograph licensee under See. 3 read with
Sec. 5. [1037H, 1038]
4. Licensing powers, an indisputable adjunct of
controlled economy, take various forms and they are
numerous. They are generally couched in a language giving
wide scope for exercise of powers. Therefore the Courts have
been vigilant to see that they are not exercised in an
oppressive or arbitrary manner. The powers being vide, the
question of its exercise on relevant or considerations
germane to the determination more often arises. If the
licence is refused on grounds which appear to be irrelevant,
the court can legitimately interfere. [1039H,1040A]
The scheme manifested by U.P. Cinema (Regulation) Act,
1955 and the U.P. Cinematograph Rubs 1951 establish the
legislative intention that the
1024
licensing authority has to keep in view public interest both
at the time of granting the certificate of approval under
Rule 3 and granting a cinematograph licence under Sec. 5.
While granting a certificate of approval under Rule 3, the
licensing authority may take into consideration the various
aspects set out in Rule 4 as well as the conditions
prescribed in Rule 7. But even where all the conditions
prescribed in Rule 4 and Rule 5 as well as various other
relevant rules are satisfied still the licensing authority
may refuse to grant the certificate of approval, if it is
satisfied that the location of cinema at the site in
question is not a public interest. [1034G-, 1035A]
6. Rule 7(2)(c) casts an obligation to record the
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reason in writing which must necessarily sufficient reasons
for refusing to grant the certificate on the ground that the
location of a cinema at the site of the building is not in
public interest. The licensing authority has not an absolute
discretion but it is hedged in by relevant considerations as
also by the proviso that if the licensing authority is
inclined to refuse the licence on the ground that the
location of a cinema at the site of the building is not in
public interest, it cannot do so except without the prior
approval of the State Government. [ 1035C-D]
In the instant case, the District Magistrate while
granting the certificate of approval on March 24,1972 bad in
terms held that Hindi Sahitya Sammelan is neither an
educational institution nor a residential institution nor it
has a public hospital and that it cannot be styled as an
educational institution for the purpose of Rule 7(2)(b)(i).
This determination is final and conclusive. [1035F]
7. While granting the cinema licence under Sec. 3 the
licensing authority has to keep in view the provision of
Sec. 5. Sec. 5(])(c) provides that no licence shall be
granted unless the licensing authority is satisfied that the
grant of licence is not otherwise contrary to public
interest. Undoubtedly, the para meters of public interest
while refusing to grant licence under Sec. 5(1)(c) for
exhibition of cinematograph would be materially different
than the one which would enter the verdict while considering
the application for granting a certificate of approval under
Rule 7(2)(c). [1035G-1036]
JUDGMENT:
CIVIL APPEALLATE JURISDICTION: Civil Appeal No. 2437 of
1981
From the Judgment and Order dated 25.8.1981 of the
Allahabad High Court in C.M.W.P.No. 3241 of 1980
R.N. Trivedi, Addl. Adv. Genl., Gopal Subramaniam and
Ms. Shobha Dikshit for the Appellants.
F.S. Nuriman, Raja Ram Agarwal, Yogeshwar Prasad, Rani
Chhabra and Ms. Suman Bagga for the Respondents,
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The Judgment of the Court was delivered by
DESAI, J. Respondent Raja Ram Jaiswal alongwith the
members of his family (’respondent’ for short) purchased
premises No. 26/30, a plot of land with a small structure
standing on it admeasuring 2978 sq yds. situated at
K.P.Kakkar Road, somewhere in March 1970. The respondent
desired to construct a cinema theatre on the plot of land
after demolishing the existing structure. As a first step,
he got prepared the plans for a modern air-conditioned,
sound proof cinema building and got the same approved by the
Local Municipal Corporation and the District Magistrate.
Subsequently on July 6, 1971, the respondent submitted an
application as required by Rule 3 of the U.P.Cinematograph
Rules, 1951 (1951 Rules’ for short) to the District
Magistrate for obtaining a certificate signifying his
approval of the site selected for constructing a permanent
building to be used for cinematograph exhibition. Before
granting the requisite certificate the District Magistrate
as the Licensing Authority has to be satisfied that the
requirements of the 1951 Rules have been fully complied
with. Inter alia it must be satisfied that any recognised
educational institution (other than primary school) or any
residential institution attached thereto is not situated
within a radius of 75 metres from the proposed cinema
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building. There were other conditions to be satisfied but
this one is being referred to by us because the allegation
is that this condition has been contravened. It also appears
that before granting the requisite certificate, with a view
to giving an opportunity to the public in the locality to
express their opinion for or against the grant of the
certificate, if they so desired, a public notice was issued
specifying the request by the respondent for issue of a
certificate of approval of the site for constructing a
cinema theatre. An organisation called The Hindi Sahitya
Sammelan (’Sammelan’ for short) alone submitted its
objection. The District Magistrate referred the application
of the respondent to the State Government. The State
Government directed the District Magistrate to carefully
examine the matter and determine whether it would or would
not be in public interest to grant the certificate. There
ensued some correspondence between the District Magistrate
and the State Government, the query centering round the
question whether the Sammelan was a recognised educational
institution as envisaged by Rule 7(2)(b) of 1951 Rules. The
District Magistrate in his letter dated March 24,1972 inter
alia stated that Sammelan can neither be styled as an
1026
educational institution nor a residential institution within
the contemplation of Rule 7(2)(b) because it is an
institution wedded to and working for the propagation of
Hindi language and even though it may provide some research
facility on its campus, it has no regular programme of class
teaching. The District Magistrate was also of the opinion
that having regard to all the relevant circumstances, the
construction of cinema building at the proposed site was not
against public interest. On the contrary according to him, a
modern beautiful fully air-conditioned cinema building apart
from adding to the beautification of the city would enrich
the coffers of the State exchequer in the form of
entertainment tax. He concluded by observing that in his
opinion public interest will not be adversely affected if
the per mission is granted for construction of the cinema
house at the proposed site and that he proposed to grant the
permission. Accordingly, on March 28,1972, the District
Magistrate informed the respondent that ’with reference to
his application dated July 6,1971 in connection with the
construction of a cinema house over Plot No. 26, Crosthwaite
Road, the site plans checked and signed by the Executive
Engineer, P.W.D. Allahabad have been approved on certain
conditions including that the construction of the cinema
house will be completed within two years from the date of
the issue of the order and the cinema house will be fully
air-condition and according to the plans and specifications
submitted
to him.’ There was a small building over the plot in
respect of which the certificate signifying the approval of
the District Magistrate was granted. This building was
demolished and construction of the cinema building according
to the plan was commenced. Chagrined by the grant of the
certificate, Sammelan initiated action for acquisition of
the plot over which the cinema building was being
constructed somewhere in August, 1973. As the various steps
taken for acquisition of land form part of a separate
controversy to be dealt with in Civil Appeal No. 2458/80,
the same may be skipped over here. Suffice it to state that
a notification under Sec. 4(1) of The Land Acquisition Act,
1894 was issued by the Collector, Allahabad on January
31,1974 notifying that Plot No. 26 admeasuring 2865 Sq. Yds.
was proposed to be acquired for a public purpose viz. for
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extension of Hindi Sangrahalaya of Hindi Sahitya Sammelan
The respondent challenged this notification in Writ Petition
No. 1932/74 in the High Court of Allahabad. In the meantime
as the period of two years specified in the certificate
issued under r. 3 was about to expire, the respondent moved
an application on March
1027
26,1974 before the District Magistrate for extension of time
for completion of the construction of cinema building. The
State Government withdrew the notification dated January
31,1974 with the result that the writ petition filed by the
respondent was dismissed on January 30,1975 as having become
infructuous. Within a period of six days on February 6,1975,
the Collector of Allahabad issued a fresh notification under
Sec. 4(1) of the Land Acquisition -13 Act for acquiring land
described as bearing Plot No. 62 admeasuring 8265 sq. yds.
for the same purpose. The respondent questioned the validity
and legality of the second notification in Writ Petition No.
3174/75. During this period, the application for extension
of time for the construction of cinema building was pending
with the District Magistrate. By Letter dated July 25,1975,
the District Magistrate informed the respondent that ’with
reference to his application dated March 26,1974 praying for
extension of time, it is not possible to grant the extension
as the matter is pending before the High Court at the
instance of the respondent and as they have obtained stay
against the land acquisition proceedings, it would not be
proper for the District Magistrate to pass any order
regarding this very land so long as the stay order granted
by the High Court is in force. It was also noticed that the
period of two years initially granted had expired in March,
1974 and the same cannot be extended. It appears, however,
that during the time the application for extension of time
for completion of the cinema building was pending with the
District Magistrate, the work of construction was going a
pace and it was completed presumably sometime before the
District Magistrate declined to grant extension of time. As
the cinema building was complete, the respondent made an
application on May 25,1979 under Sec. 3 of the U.P. Cinema
(Regulation) Act, 1955 (’1955 Act’ for short) for a licence
to exhibit films in the cinema building. Though the District
Magistrate is a statutory authority for grant or refusal of
licence under the 1955 Act, surprisingly, he referred the
application of the respondent for grant of licence to the
State Government specially in view of the pendency of the
Writ Petition No. 3174/75 challenging the notification for
acquisition of the land on which the cinema building was
constructed.A communication from the Joint Secretary of the
State Government to the District Magistrate concerning the
question of grant of cinema licence has a material bearing
on the issue involved in the writ petition. Therefore the
relevant portion of the communication may be extracted. It
reads as under:
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"With reference to your letter No. 23/MAOKA./79-80
dated June 27, 1979, I have been directed to say that
you may grant licence to Chandralok Cinema constructed
by Sri Raja Ram Jaiswal on the Hindi Sahitya Sammelan
Marg, for one year if you are satisfied that this
cinema complies with the requirements of the Uttar
Pradesh Chalchitra Niyamawali, 195’ with the condition
that if in the mean time the case pending before the
Hon’ble High Court is decided in favour of the
Government, the licence would automatically stand
cancelled."
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It would thus appear that the District Magistrate had
to consider the application for licence uninfluenced by
another litigation pending between the respondent and the
State Government. On receipt of this letter the District
Magistrate after obtaining reports from various authorities
vis-a-vis the building reiterated his view to the State
Government on October 19,1979 that as the writ petition of
the respondent challenging the notification for acquisition
of land is pending, it would not be proper to grant cinema
licence to the respondent. On December 7,1979, writ petition
filed by the respondent challenging the notification for
acquisition of land on which the cinema building was
constructed was allowed by a Division Bench of the High
Court and the notification dated February 6,1975 was
quashed. On December 9,1975, the respondent made a
representation to the State Government for issuance of a
cinema licence. By the, notification date December 13,1979,
the State Government directed the first respondent to
contact the District Magistrate in this behalf. Accordingly,
on December 18, 1979, the respondent wrote to the District
Magistrate that all the concerned authorities had inspected
the building and reported that the building complies with
all the rules and regulations and recommended grant of
licence. By its communication dated December 24, 1979, the
Additional District Magistrate informed the respondent that
’with reference to his application for cinema licence dated
May 4, 1979 to run Chandralok Cinema he has to inform him
that the District Magistrate’ by his order dated December
24, 1979 has refused to grant the licence.’ The respondent
preferred an appeal under Sec. 5(3) of the 1955 Act to the
State Government against the order of the District
Magistrate refusing to grant the licence. The reasons which
weighed with the District Magistrate in rejecting ll the
application will be dealt with a little while after. The
State
1029
Government called for the comments of the District
Magistrate with regard to the contentions raised by the
respondent in his appeal and after taking into consideration
the comments, the State Government as per its order dated
February 15,1980 allowed the appeal and remitted the matter
to the District Magistrate with a direction, to re-examine
the grounds on which he had refused to grant licence to run
the Chandralok cinema in accordance with the rules and pass
suitable and legal order after giving them an opportunity of
hearing. If the District Magistrate feels necessary to seek
prior approval of the Government to refuse to grant licence
in public interest, he may express his opinion and send full
facts through the Commissioner for prior approval.’ This
order of remand was questioned by the respondent in Writ
Petition No. 3241/80 in the Allahabad High Court.
A Division Bench of the High Court held that even
though the order under challenge was one of remand, as the
respondent has journeyed to and fro on numerous occasions,
it is necessary to dispose of the petition on merits. It was
further held that while granting a certificate under Rule 3
of the 1951 Rules, it was open to the licensing authority to
take into consideration whether it would be in public
interest to grant the necessary certificate or to refuse the
same, hut after the grant of the certificate when a full
fledged cinema building comes up and is shown to comply with
the relevant rules and regulations, cinematograph licence
cannot be refused on the vague consideration that it would
not be in public interest to grant the licence. It was also
held that the failure to complete the construction of cinema
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building within the prescribed time, if properly explained
would not be a ground to refuse cinematograph licence, more
so because the requirement of rule 3(3) is directory and not
mandatory. The High Court accordingly made the rule absolute
and in modification of the order of the State Government
dated February 15,1980 it directed the District Magistrate-
Licencing Authority-to forthwith grant to the petitioner the
requisite licence subject to reasonable conditions and
restrictions. An order in the nature of mandamus was issued
accordingly. Hence this appeal by the State of Uttar Pradesh
and the District Magistrate by special leave.
Before we advert to the contentions canvassed before us
on behalf of the appellants, a brief resume of the stages
through which
1030
the proceedings journeyed in this Court may be mentioned.
The petition for special leave came up for admission on
September 17, 1981 when special leave to appeal was granted
and the operation of the judgment of the High Court was
stayed. Consequently, the mandamus directing the District
Magistrate to grant licence stood suspended. CMP 26710/81
was moved on behalf of the present respondent for vacating
the stay granted by this Court. The proceedings dated
December 15, 1981 as recorded show that after the arguments
were heard at some length, the Court in the interest of
justice thought it expedient to modify the stay order dated
September 17,1981 to the effect that the stay order granted
by the Court will be in operation for a further period of
two months only and that the hearing of the appeal may be
expedited. The present appeal and the cognate Appeal No.
2458/81 came up together for hearing and the cognate appeal
was first taken up for hearing for the obvious reason that
if the challenge to the notification for acquisition of the
plot on which the cinema building is constructed failed in
the appeal on behalf of the State of U.P., it would have an
impact on the present appeal because if the land was to be
acquired, the question of granting licence for running a
cinema on the land under acquisition could hardly be
envisaged. The hearing as usual in this Court went on
merrily. Therefore, after hearing the parties, we made the
order on January 20,1983 directing the District Magistrate
to comply with the remind order. It may be recalled that the
order under challenge in this appeal was the order of remand
made by the State Government to the District Magistrate for
considering and disposing of the application for a cinema
licence on merits. We had some hesitation whether the court
can grant a mandamus directing a statutory authority to
grant a licence at a stage when the District Magistrate was
yet to apply his mind and examine the application on merits
because doing so would tantamount to the court substituting
itself as a licensing authority without the licensing
authority performing its duty, which would be impermissible.
We were conscious of the fact that the District Magistrate
was bound to take some time in processing and disposing of
the application for a cinema licence pending with him.
Accordingly, we directed the District Magistrate to proceed
to consider the application of the respondent for grant of a
cinema licence and dispose of it in the light of the
observations made in the order. Pursuant to this order, the
District Magistrate, Allahabad proceeded to examine the
application of the respondent for cinema licence on merits
and having given him an opportunity of being heard, by his
order dated
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February 20, 1983 rejected the application for licence
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observing that it would not be in public interest to grant
the cinematograph licence applied for by the respondent. The
appeal was again placed on board for further directions on
March 10, 1983. After giving anxious consideration to the
order of the District Magistrate, the Court made an order
vacating interim stay granted by this Court staying the
operation of the judgment of the High Court. The effect of
this order was that the mandamus granted by the State became
operative. Accordingly. On March 19, 1983, the District
Magistrate granted the licence to run Chandralok cinema. Two
CMPs Nos. 12718-19/83 were moved in this Court, one of them
being for taking action for contempt and another for certain
directions. They were a sequel to the granting of a licence
and public annoyance demonstrably exhibited by the
authorities of the Sammelan. While disposing of these
petitions, we directed that the City Magistrate would
withdraw the impugned order under Sec. 144, Cr.P.C. within a
fortnight from the date of the order and the District
Magistrate shall renew the licence of Chandralok cinema to
be operative and in force till the decision of appeal by
this Court and the City Magistrate shall make necessary
arrangements to maintain public order near and around
Chandralok cinema if necessary by posting additional police
force and grant necessary protection to the licensee
enabling him to run the cinema house peacefully.
Regrettably, it must be concluded from this resume that the
dispute is hardly between the State Government and the
respondent, but it is a proxy fight consequent upon the
clash of ego between the Sammelan and Jaiswal. Uninfluenced
by this irrelevant aspect, the appeal may be disposed of on
merits.
It may be mentioned that even though the Sammelan had
moved an application for being joined as a party to the writ
petition in the High Court which was rejected, we, without
the slightest hesitation, granted the request for
intervention made by Shri S.N Kacker, learned counsel for
the Sammelan to intervene and suspending the normal
procedure that the interventionist is not entitled to
address oral arguments, we heard Mr. Kacker on all points he
wanted to canvass and at some length and permitted him to
put his written submissions on record.
While the introduction has become some what long, the
Contentions canvassed in the dispute are relatively of an
insignificant
1032
nature save and except the one whether the statutory
licencing authority acting within the parameters of the
statute under which it is set up can be supplanted in
exercise of the writ jurisdiction before the statutory
authority has yet to discharge its functions under the
statute. Incidently, whether public interest has a relevance
at the time of issuance of a certificate of approval under
Rule 3 or at the time of grant of licence under Sec. 3 is
another important question ? Other contentions are minor and
of incidental nature.
The present situation viewing the background of public
interest have a direct bearing on the rival contentions in
this appeal.A cinema building in which for the purposes of
the record, we may note that Rs. 60 lakhs have been sunk
stares into our face. Admittedly, it is a modern air-
conditioned sound-proof cinema building. It abuts on a road
named K.K.Marg, a very prominent locality in Allahabad town.
it is equally true that Hindi Sahitya Sammelan has its
campus at a distance of roughly 95 feet from the outer
boundary of the cinema building. Hindi Sahitya Sammelan was
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founded for the development and propagation of Hindi, and
certainly it is a prestigious institution devoted to making
Hindi the Lingua Franca of India. Though Hindi Films have
contributed immeasurably to the propagation of Hindi yet the
Sammelan championing Hindi appears not to have taken kindly
to the modern mass media communication and detested the
existence of a theatre somewhere near its campus. That is
the genesis of the present litigation. Sincere efforts were
made to assuage all the authorities in charge of the
Sammelan, but they proved of no avail. May be an institution
devoted to research may consider cinema theatre a nuisance
but in an urban area like Allahabad. the Sammelan cannot
hope to live in isolation of the existence of theatre as
also the noise OF transport vehicles.
Let us have a glance at the relevant provisions of the
1955 Act and the 1951 Rules which should be our starting
point. 1955 Act was enacted as its long title shows for
making provisions and regulating exhibitions by means of
cinematographs in the State of U.P. Sec. 3 provides that
’save as otherwise provided in the Act, no person shall give
an exhibition by means of a cinematograph elsewhere than in
a place licensed under this Act or otherwise than in
compliance with conditions and restrictions imposed by such
licence.’ Sec. 4 constitutes District Magistrate to be the
Licensing
1033
Authority. There are two provisos conferring power on the
State Government to constitute other licensing authority.
They are hardly material for the present purpose. Sec. 5‘
prescribes restrictions on the power of the licensing
authority and inter alia provides that ’the licensing
authority has to be satisfied that the building or other
place in which cinematograph exhibition proposed to be given
(i) ..... (ii) is situated at such minimum distance as may
be Ii prescribed from other public buildings and from
recognised educational and other public institutions and
public hospitals.. ’ Sec. 5 (1)(c) provides that the
licensing authority must be satisfied that the grant of
licence otherwise is not contrary to public interest. Sub-
sec. (3) of Sec. 5 confers right of appeal to the State
Government, on any person aggrieved by the decision of the
licensing authority refusing to grant licence. Sec. 13
confers power on the State Government to make rules for
carrying out the purposes of the Act. 1951 Rules were framed
in exercise of the power conferred by Sec. 9 of the
Cinematograph Act, 1918 and by the deeming fiction enacted
in Sec. 12 of the 1985 Act they remain in force. Rule 3
provides as under
"3. Application for constructing a building-
(1) A person desirous of constructing a permanent
building to be used for cinematograph exhibition shall
submit an application specifying the site on which the
proposed building is to be constructed together with‘ a
plan and specifications thereof to the officer
authorised in this behalf by Government. (2) The plan
mentioned in the aforesaid sub-rule shall contain the
elevations and sections of the buildings, the proposed
electrical installations, arrangements for ventilation,
sanitation and parking of vehicle and the position of
the premises in relation to adjacent premises and
public thoroughfare on which the building abuts, within
a radius of one furlong. (3) The Licensing Authority
may, if it is satisfied that the site plans and
specifications fully conform to the rules, grant to the
applicant a certificate signifying his approval
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thereto. The period within which the construction shall
be completed shall also be stated in the certificate."
Rule 4 provides for the contents of an application for
a
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licence. Rule 7 prescribes conditions for granting and
renewal of a licence, the one to be noted for the present
purpose is the one prescribed in Rule 7(2)(b)(i) which is to
the effect that ’no building shall be so licensed, if it is
situated within a radius of 75 metres from any recognised
educational institution (other than primary school) or any
residential institution attached thereto. Rule 7(2)(c)
provides that ’no building shall be so licensed, if for any
other sufficient reason to be recorded, the licensing
authority is satisfied that the location of a cinema at the
site of that building is not in Public interest.
Learned Advocate General of Uttar Pradesh who appeared
for the appellant urged that the scheme of the Act and the
relevant rules reveal that the licensing authority has to
take into consideration public interest both at the time of
granting a certificate of approval as contemplated by Rule 3
as also public interest while granting a cinema licence
under Sec. 3 read with Sec. 5. It was urged that the High
Court was in error in holding that once while granting a
certificate of approval under Rule 3, public interest has
been taken into consideration and it has been found that the
location of a cinema at the site of the building is not
shown to be not in public interest, the question of
examining whether such building should be licenced for
exhibition of a cinematograph does not call for a re-
examination whether the grant is not otherwise contrary to
public interest. It was urged that public interest cannot be
fitted into a straight jacket formula and what relevant
considerations would constitute public interest at the time
of granting a certificate of approval under Rule 3 may
materially vary or p differ from the relevant considerations
which may constitute public interest while licensing the
cinema theatre for exhibition of a cinematograph under Sec.
3. The scheme manifested by the relevant provisions of the
Act and the Rules would demonstrably establish the
legislative intention that the licensing authority has to
keep in view public interest both at the time of granting
the certificate of approval under Rule 3 and granting a
cinematograph licence under Sec. 3. While granting a
certificate of approval under Rule 3, the licensing
authority may take into consideration the various aspects
set out in Rule 4 as well as the conditions prescribed in
Rule 7. But even where all the conditions prescribed in rule
4 and Rule 5 as well as various other relevant rules are
satisfied still the licensing authority may refuse to grant
the
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certificate of approval, if it is satisfied that the
location of cinema at the site in question is not in public
interest. What constitutes public interest at the time of
consideration for granting certificate of approval may be
culled out from the various conditions prescribed in the
various statutes as well as all other considerations which
may enter the verdict while granting the certificate. But it
will be a paper compliance with the relevant rules if it is
merely stated that even though all other conditions are
satisfied and complied with the licensing authority would
refuse to grant the certificate as it is not in public
interest to do so. Rule 7(2)(c) casts an obligation to
record the reasons in writing which must necessarily be
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sufficient reasons for refusing to grant the certificate on
the ground that the location of a cinema at the site of the
building is not in public interest. The licensing authority
has not an absolute discretion but it is hedged in by
relevant considerations as also by the proviso that if the
licensing authority is inclined to refuse the licence on the
ground that the location of a cinema at the site of the
building is not in public interest, it cannot do so except
without the prior approval of the State Government. There is
an explanation which provides that for the purpose of the
sub-rule, the licensing authority shall, subject to the
general control of the State Government, determine what is a
public hospital or a recognized educational institution, and
its decision shall be final and conclusive.’ It will be
presently pointed out that the District Magistrate while
granting the certificate of approval on March 24, 1972 had
in term’s held that Hindi Sahitya Sammelan is neither an
educational institution nor a residential institution nor it
has a public hospital and that it cannot be styled as an
educational institution for the purpose of Rule 7(2)(b)(i).
In view of the explanation herein extracted, this
determination is final and conclusive.
Now while granting the cinema licence under Sec. 3, the
licensing authority has to keep in view the provisions of
Sec. 5 Sec. 5(1)(c) provides that no licence shall be
granted unless the licensing authority is satisfied that the
grant of licence is not otherwise contrary to public
interest. One has to compare the language of Rule 7(2)(c)
with the language implied in Sec. 5(1)(c). Undoubtedly the
parameters of public interest while refusing to grant
licence under Sec 5(1)(c) for exhibition of cinematograph
would be materially different than the one which would
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enter the verdict while considering the application for
granting a certificate of approval under Rule 7(2)(c). It
must, however, be made absolutely clear so as to put it
beyond the pale of controversy that the relevant aspects
required to be kept in view as prescribed under Rule 7 while
granting or refusing to grant certificate of approval under
Rule 3 cannot be reviewed in The name of public interest for
rejecting an application for cinematograph licence under
Sec. 3 read with Sec. 5 of the Act. To wit, if while
granting the certificate of approval the question whether a
particular institution is an educational institution and is
within or outside the prohibited distance, is examined and a
decision is reached that the institution is held not to be
an educational institution within the contemplation of the
relevant rule nor it is within the prohibited area, this
aspect cannot be reviewed to refuse to grant a licence under
Sec. 3 read with Sec. 5 in the name of public interest. If
any other view is taken, it would lead to startling results.
Again to wit, if the Sammelan was held not to be an
educational institution with in the contemplation of Rule
7(2)(b)(i) and the necessary certificate of approval is
granted, the licensing authority cannot turn round in the
name of public interest and hold at the time of considering
the application for a cinematograph licence that the Hindi
Sahitya Sammelan is an educational institution and it is
also situated within the prohibited area because such an
approach would do irreparable and irreversible harm to the
person to whom certificate of approval is granted because by
the time he applies for a cinematograph licence under Sec.
3, he has sunk a large sum of money in constructing a cinema
building. To refer to the facts of this case, if now the
District Magistrate chooses not to grant licence on the
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ground that it would be contrary to public interest to grant
licence only because the authorities of the Sammelan may act
in a manner so as to disturb public peace and that it is an
educational institution, Rs. 60 lakhs sunk by the respondent
would go down the drain and would be an irreparable wastage
affecting both the national interest and the public
interest. Therefore, while accepting the submission of the
learned Advocate General that the concept of public interest
statutorily recognised has to be kept in view both at the
time of granting certificate of approval under Rule 3 and
licence under Sec. 3 read with Sec. 5 of the 1955 Act,
permitting exhibition of a cinematograph, the relevant
parameters of public interest would differ and they cannot
overlap each other and have to be justified on the relevant
grounds stricter view about the parameters of public
interest has to be taken at the
1037
second stage because by that time the person who has been
granted certificate of approval has sunk a fortune in the
venture.
Before we conclude on this point, we may refer to the
two decisions to which our attention was drawn by the;
learned Advocate General. In The King v. London Country
Council, Exparte London and Provincial Electric Theatres
Limited(l) it was held that the statutory authority was
justified in exercise of their discretion to sefuse to grant
licence to a company, the majority of whose shareholders
were alien enemies..A submission was made on the basis of
the ratio of this decision that even if a cinema building is
constructed, licence can be refused on the ground that it is
not in public interest to do so. The decision in R.
v.Barnstaple justices, Exparte Carder.(8) is hardly of any
assistance because it proceeds on the scheme of the
Cinematograph act, 1909. The Act empowered County Councils
or justices where the power have been delegated to them to
grant licences to persons to use premiss specified In the
licence’ for the purposes of a cinema, subject to certain
conditions, terms and restrictions. The practice was stated
to be in existence whereby, in cases where it was intended
to erect premises for use as a cinema, justices were asked
to approve the plans of the building to be erected, and
thereby honourably to commit themselves or their successors
to grant the licence after completion of the premises.
Disapproving this practice, it was held that the practice
was beyond the powers given by the Act and is unenforceable.
It was observed that it was improper for justices by a
gentlemen’s agreement to fetter, limit control, or in any
way affect their own future decisions, or those of their
successors or of other justices. The scheme of the Act and
the rules at present under examination envisages two stages
when the licensing authority has to examine the application:
(i) at the stage of grant of certificate Of approval of the
site and (ii) at the stage of grant of cinema licence. In
view of this difference in the scheme, the decision is
hardly of any assistance. We have reached the conclusion
purely on the examination and interpretation of the scheme
merging from the Act and the Rules.
The High Court was therefore, in our opinion, in error
in holding that once the public interest has been taken into
cosidera-
(1) [1915] 2 K.B. 266
(2) [1937] 4 All E.R. 263
1038
tion while granting certificate of approval, consideration
of public interest would not arise and cannot be
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countenanced while granting a cinematograph licence under
Sec. 3 read with Sec. 5.
The next question is whether the District Magistrate in
this case was justified in refusing to grant the licence in
public interest on relevant consideration.
The District Magistrate initially refused to grant
licence against which in the appeal preferred by the
respondent, the order impugned in the writ petition was made
by the State Government The State Government called for the
comments of the District Magistrate qua the contentions
raised by the respondent in his appeal. Briefly summarised
the view expressed by the District Magistrate in his
comments, which was the view that prevailed with him while
rejecting the application for license, was that the relevant
rules having not been complied with: (i) inasmuch as the
cinema hall has been constructed in the restricted area a; d
educational institutions are situated within 100 yards of
cinema house; (ii) there is no provision to give conditional
licence under the cinema rules; (iii) the allegation that
the District Magistrate has some bias against the respondent
was not correct; (iv) the licence has been refused in public
interest on consideration of public peace and order; (v) the
construction of cinema building was not completed within the
prescribed period of two years; (vi) if the licence is
granted, there is apprehension of breach of peace. These
comments provide a peep into the mind of the District
Magistrate while rejecting the application for licence. The
State Government while quashing the order of the District
Magistrate refusing to grant licence held that the reasons
on the basis on which the licence to run cinema was rejected
do not fall within the cinematograph Rules and violation of
no specific rule is shown. That sets at naught ground Nos.
(i), (v) and (vi). The charge of bias was shown to be not
merited and failure to complete the construction within the
specified time did not merit rejection of the application
for licence. Location of educational institutions within the
prohibited area would not enter the verdict at the stage
granting cinematograph licence because the same was taken
care of and rejected while granting the certificate of
approval. It is even factually not correct. Accordingly, the
State Government remitted the matter to the incensing
authority to consider whether licence could be refused in
public interest and if it is to be so refused, the prior
appro-
1039
val of the State Government may be obtained. Therefore the
remand order limited the enquiry by the District Magistrate
to question of grant or refusal of licence in public
interest. Other aspects are concluded by the remand order.
Therefore, the only question that survives for
consideration is whether the District Magistrate is now
justified in refusing to grant licence on the ground that it
is not in public interest to do so. Reading the order dated
February 20, 1983, as a whole the influence of the Sammelan
permeates through the order. Curiously, after the direction
given by the Court that the District Magistrate shall
process and dispose of the application for licence, the
District Magistrate give a public notice inviting objections
to the grant of cinematograph licence. The only objector
again appears to have been the Sammelan and it has repeated
all those objections which it had preferred at the time of
granting of certificate of approval. The objections of the
Sammelan were founded on two environmental aspects: (i) that
the surroundings of the campus of Sammelan are calm and
quiet and there is such an atmosphere as would be conducive
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to the research work conducted on the campus of the
Sammelan; (ii) granting of a cinematograh licence would
disturb the cultural and educational environment of the
locality and would be a traffic nuisance. In our opinion,
both are irrelevant considerations for the obvious reasons
that they are deemed to have been disposed of while granting
certificate of approval and affirmed by the State Government
in appeal. They ought to be rejected for the additional
reason that the cinema building is an air-conditioned sound-
proof building. It is not possible to believe that
conducting cinematograph exhibition in a sound-proof
building will add to the noise. The grievance was that once
a cinema theatre comes up, tea stalls will spring up, hawers
would crowd the locality and traffic would increase is
hardly relevant. There is nothing special about it. Anyone
living in a developing urban area has obviously to put up
with this situation. Noise can be mitigated not wholly
obliterated. Therefore, the District Magistrate rejected the
application on extraneous and irrelevant considerations not
germane to the issue at the stage of granting the licence.
Licensing powers, an indisputable adjunct of controlled
economy, take various forms and they are numerous. They are
generally couched in a language giving wipe scope for
exercise of powers
1040
Therefore the courts have been vigilant to see that they are
not exercised in an oppressive or arbitrary manner. The
powers being wide, the question of its exercise on relevant
or considerations germane to the determination more often
arises. If the licence is refused on grounds which appear to
be irrelevant, the court can legitimately interfere. In this
case the sole ground of refusal of licence is that it is
not in public interest to grant it. Lifting the veil of
public interest what transpires is that the license should
not be granted because the Sammelan is not reconciled to the
existence of a cinema theater in its vicinity. In other
words, public interest is shown to be co-extensive with the
likes and dislikes of the authorities in charge of the
Sammelan. This cannot be countenanced. Dislike of a body
howsoever prestigious it may be, is not an adequate
substitute for public interest. The licensing authority has
clearly acted on irrelevant consideration in refusing the
licence.
The High Court was of course, clearly in error in
issuing a mandamus directing the District Magistrate to
grant a licence. Where a statute confers power and casts a
duty to perform any function before the power is exercised
or the function is performed, the Court cannot in exercise
of writ jurisdiction supplant the licensing authority
hearing a writ petition praying for a wit of certiorari for
quashing the order of remand. The High Court could have
quashed the order of remand if it was satisfied that the
order suffers from an error apparent on the record. But
there its jurisdiction would come to an end. The High Court
cannot then proceed to take over the functions of the
licensing authority and direct the licensing authority by a
mandamus to grant license. To that extent the judgment of
the High Court is set aside. However, as pointed earlier,
while narrating the chronology of events through which the
appeal proceeded in this Court, the present situation is
that the District Magistrate by its order dated February 20,
1983 refused to grant licence on extraneous and irrelevant
considerations, and it has failed to exercise jurisdiction
vested in it. This Court, therefore, on March 10, 1983
vacated the interim stay of the operation of the judgement
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of the High Court. Within a week thereafter the District
Magistrate granted license and lt was renewed for a further
period of one year in April, 1984. That licence is valid and
in force and holds good, subject to the application for its
renewal at prescribed intervals. The order dated
1041
February 20, 1983 refusing to grant license in public
interest is quashed and set aside. The District Magistrate
as licensing authority shall examine the application for
renewal of licence whenever made, on relevant and legally
valid considerations germane to the determination and in the
light of the observations made in this judgment.
Subject to the modifications set out in this judgment,
the appeal fails and is dismissed but with no order as to
costs.
N.V.K. Appeal dismissed.
1042