Full Judgment Text
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE/ORIGINAL JURISDICTION
Civil Appeal No 77 of 2023
(Arising out of SLP(C) No 20784 of 2018)
K C Cinema (Correct Name K C Theatre) .... Appellant(s)
Versus
State of Jammu and Kashmir & Ors ....Respondent(s)
WITH
Civil Appeal No 78 of 2023
(Arising out of SLP(C) No 20904 of 2018)
Civil Appeal No 79 of 2023
(Arising out of SLP(C) No 21924 of 2018)
Transferred Case No 28 of 2019
Transferred Case No 29 of 2019
Signature Not Verified
Digitally signed by
Sanjay Kumar
Date: 2023.01.16
14:58:59 IST
Reason:
J U D G M E N T
Table of Contents
A. Background .................................................................................................................. 3
B. Cases relied upon by the respondents ...................................................................... 7
C. The High Court has transgressed its jurisdiction under Article 226 of the
Constitution ...................................................................................................................... 11
D. Parting remarks ......................................................................................................... 19
2
Dr Dhananjaya Y Chandrachud, CJI
Civil Appeal Nos 77, 78 and 79 of 2023
1. Leave granted.
A. Background
2. This batch of appeals arises from a judgment dated 18 July 2018 of a
Division Bench of the High Court of Jammu and Kashmir. A public interest
litigation was instituted before the High Court by two practicing advocates
with the grievance that cinema theatres in Jammu and Kashmir were
prohibiting movie goers from bringing eatables inside cinema halls. In this
context, it was averred that cinema owners paste a notice outside the hall
indicating the prohibition and that security personnel search the belongings
of every cinema goer with a view to enforce the prohibition. In the event that
movie goers are found in possession of eatables, they are (it was alleged)
prevented from entering the cinema hall.
3. The submission which was urged before the High Court was that, as a
consequence of the prohibition, movie goers are compelled to consume
food and beverages which are made available within the precincts of cinema
halls resulting in the audience being required to purchase food at “highly
exorbitant rates.” Moreover, it was submitted that the food which is sold is
not necessarily of a nutritious quality and that persons with chronic diseases
(such as diabetes) may be required to eat a specific type of food which
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would not be available at the movie hall.
4. The High Court was persuaded to grant relief in the public interest litigation
on the basis of its findings in paragraph 6, which is extracted below:
“6. A perusal of these rules reveals that no where it has been provided that
cinemagoers can be prohibited from carrying their own food articles and
water bottles to multiplexes or private vendors are allowed to sell food inside
such multiplexes/cinema hall premises at highly exorbitant prices. Therefore,
in absence of any such provision, cinema goers cannot be forced or
compelled by the multiplexes/cinema hall owners to purchase food and
water from theatre premises nor they can be prohibited from carrying food
items into malls and multiplexes from outside. Even the viewers, who come
along with their infants/babies, also need milk to feed them because they
cannot be kept empty stomach for about three long hours. The restrictions
on bringing outside food to theatres and compelling/forcing to purchase junk
food, sold at the food stalls inside theatre premises, that too at exorbitant
rates, particularly affect young generation, senior citizens, diabetic patients
and those who cannot eat for medical reasons. Such kind of acts on the part
of Multiplex/Cinema Hall owners are against the right to choice of food,
including the right not to eat junk food and right to good health, which comes
under the purview of Article 21 of the Constitution of India guaranteeing
protection of life and personal liberty of every citizen.”
5. The High Court noted that the State Government had notified the Jammu
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and Kashmir Cinemas (Regulation) Rules 1975. The High Court held that:
a. The 1975 Rules do not prohibit cinema goers from carrying their own
food articles and water bottles to multiplexes or cinema halls;
b. As a consequence of the prohibition which is imposed by cinema hall
owners, viewers are compelled to purchase food of such nature as is
offered for sale within the precincts of the theatre;
c. Infants who are required to be fed at periodic intervals cannot as a
consequence, be given food by accompanying parents or guardians;
1
“1975 Rules”
4
d. Viewers are compelled to purchase “junk” food at the food stalls within
the theatre and are required to pay exorbitant charges for the food
which is purchased. This particularly affects the younger generation,
senior citizens, patients with diabetes, and those who are unable to eat
the food sold within the theatre premises for medical reasons; and
e. The prohibition on carrying outside food and beverages into the movie
theatre violates the right to choice of food, including the right not to eat
“junk” food and the right to good health, under Article 21 of the
Constitution.
6. The High Court, while accepting the grievances, issued a slew of directions
in the impugned judgment and order. The challenge to the judgment of the
High Court is confined to direction (i) which is extracted below:
“i. Multiplexes/Cinema Halls Owners of the State of J&K are directed not to
prohibit cinema goers/viewers henceforth from carrying his/her own food
articles and water inside the theatre.”
7. Mr K V Viswanathan, senior counsel, appearing with Mr Niranjan Reddy,
senior counsel and Mr Sumeer Sodhi, on behalf of the appellants submitted
that:
a. The precincts of a cinema hall constitute private property into which
admission is reserved by the owner of the theatre;
b. The 1975 Rules which have been framed by the State Government do
not provide that the movie goer should be allowed to bring eatables or
beverages from outside into the precincts of the cinema hall;
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c. There is no compulsion on any person either to visit the theatre or to
purchase food within the precincts of the theatre once they have bought
a ticket to view a movie;
d. As regards the sale of drinking water, cinema halls make adequate
provisions to ensure that hygienic drinking water is made available free
of cost within the precincts of the movie theatre for movie goers so that
they are not compelled to pay for packaged drinking water;
e. As a matter of practice, the prohibition of bringing food or beverages
from outside the hall is not enforced in the case of infants and babies,
for whom the parents or accompanying guardians are allowed to bring
a reasonable quantity of food or beverages which may be required for
the duration of their visit to the theatre; and
f. The cinema tickets issued by the appellant theatre in Civil Appeal No.
78 of 2023 to the movie goers stipulate that eatables from outside as
well as bottles (empty or filled) are not allowed inside the cinema hall.
The tickets also mention that the cinema reserves the right of
admission.
8. On the other hand, Mr Bimal Roy Jad, senior counsel appearing on behalf of
the original petitioners before the High Court (Respondents No. 3 and 4 in
these proceedings), submitted that:
a. The cinema ticket which is issued by the cinema hall represents a
contract with the movie goer and in the absence of any prohibition on
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the printed terms of the ticket, a movie goer cannot be prevented from
bringing eatables or beverages inside the theatre;
b. As a consequence of the prohibition which is imposed by the cinema
hall, the movie goers are placed at a substantial inconvenience since
they are required to purchase food and beverages at exorbitant rates
within the movie halls; and
c. The 1975 Rules do not contain any prohibition on bringing food or
beverages from outside within the precincts of the cinema halls.
B. Cases relied upon by the respondents
9. Counsel for the respondents has relied on the following judgments in support
of the directions issued in the impugned judgment:
a. Parker v. The South Eastern Railway Co (1877) 2 CDP 416;
b. v. (1949) 1 KB 523;
Olley Marlborough Court Ltd
c. McCutcheon v. David Macbrayne Ltd (1964) 1 WLR 125; and
d. Thornton v. Shoe Lane Parking Ltd (1970) EWCA Civ 2.
10. In order to understand whether the rulings in these judgments are applicable
to the case before us, it is necessary to advert to the context in which they
originated, the question(s) of law which fell for the court’s determination, and
the relief claimed therein.
11. In Parker’s case (supra), the plaintiff deposited some of his belongings with
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the cloakroom at a railway station. At the time of depositing them, he
received a ticket which had the words “see back” printed on it. The reverse
side of the ticket contained a term stating, “ the company will not be
responsible for any package exceeding the value of 10l .” A placard with the
same condition printed on it was also hung on the wall. The plaintiff’s
belongings were lost or stolen and he brought an action against the
defendant for the value of the lost articles. The plaintiff had not seen the
condition regarding the defendant’s liability for any articles deposited, either
on the ticket or on the placard on the wall. The question before the court in
that case was whether the respondent was liable for the loss of the plaintiff’s
belongings.
12. In Olley’s case (supra), the plaintiff was a paying guest in the defendant’s
hotel. After paying for the room, she received her keys and went to her room.
There, a notice containing numerous terms and conditions was displayed.
One of the conditions was “ The proprietors will not hold themselves
responsible for articles lost or stolen, unless handed to the manageress for
safe custody .” The plaintiff’s possessions were later stolen from her room.
The plaintiff instituted a suit against the defendant and claimed the value of
the goods stolen from her. The court was required to adjudicate whether the
defendant could rely on the terms of a contract to exempt itself from liability
under common law. In other words, the question that arose for determination
was whether the defendant was responsible for the loss suffered by the
plaintiff.
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13. In McCutcheon’s case (supra), the plaintiff engaged an agent to have his
car delivered to another town by sea. The agent paid the defendant,
received a receipt, and delivered the car. The car was loaded onto the ship
which set sail. Before it could reach its destination, however, it sank due to
the negligence of the defendant’s employees. The plaintiff sued the
defendant for the value of his car. The defendant disclaimed liability on the
ground that it usually asked customers to sign a risk note which contained
certain terms and conditions regarding its liability for damage to the goods
shipped by customers. No such risk note was signed by the plaintiff’s agent
in this case, but he had signed risk notes on previous occasions when he
had used the defendant’s shipping services. The defendant argued that it
would not be liable for the loss of the car because the plaintiff’s agent was
aware of the terms and conditions in the course of their dealings with one
another. In this case, too, the question which arose for the court’s
consideration was whether the defendant could be held liable for the loss of
the plaintiff’s car.
14. Finally, in Thornton’s case (supra), the plaintiff drove to an automatic car
park owned by the defendant. The charges for availing of this service were
displayed outside the car park. The plaintiff drove to the entrance and a
machine dispensed a ticket which said, “ This ticket is issued subject to the
conditions of issue as displayed on the premises .” The plaintiff parked his
car in the car park. When he later returned there to collect his car, he
suffered an accident and was severely injured. He instituted proceedings
against the defendant seeking damages for his injuries. The question before
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the court was whether the defendant would be liable for the injuries
sustained by the plaintiff.
15. All four cases concern the issue of whether liability can be affixed on one of
the parties based on the terms and conditions of the contract in question.
Each of the decisions addresses when the contract was entered into and
what the terms of the contract were. The court considered whether a
particular term which was intended by one of the parties to form a part of the
contract, would in actuality form a part of the contract and bind the other
party, thereby exempting the first party from liability for the loss suffered.
16. The case before us differs from the four cases relied upon by the
respondents in that the original petitioners before the High Court did not file
a suit for damages or other relief for a loss or injury suffered by them. They
instituted a Public Interest Litigation and invoked the High Court’s jurisdiction
under Article 226 of the Constitution. They claimed the following relief in their
petition before the High Court:
“(ii) Writ of prohibition prohibiting Respondents No. 3 – 6 from restraining the
movie goers for taking with them outside eatables inside Cinema Halls
required to be consumed during the time they see the feature film in the
cinema hall”
17. By instituting a writ petition, Respondents 3 and 4 have invited an
adjudication on whether the terms of entry determined and enforced by
theatre owners are just and fair. The test to be applied by this Court would
therefore not address which of the terms and conditions between the theatre
owners and the movie goers are binding upon them and whether the
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prohibition on carrying outside food within the theatre premises is a binding
term. Similarly, this Court is not called upon to decide whether Respondents
3 and 4 suffered any injury due to the enforcement of the prohibition on
outside food and whether they are entitled to damages, as a result of the
injury suffered. Rather, this Court will evaluate whether this was a case fit for
the exercise of the High Court’s writ jurisdiction under Article 226 of the
Constitution.
18. If it was the case of Respondents 3 and 4 that they had suffered some injury
due to the prohibition on carrying food and beverages into the movie hall or
that the terms of the contract were made known to them only at the time of
its enforcement and they sought a refund of the amount paid for the ticket
because they did not assent to such a term or damages, the proper remedy
would be to file a suit and not to seek the issuance of a writ. The decisions in
Parker (supra) , Olley (supra) , McCutcheon (supra) , and Thornton (supra)
which the respondents rely on do not have a bearing on the issue before this
Court i.e., whether the High Court was justified in exercising its jurisdiction
under Article 226 of the Constitution. It is therefore not necessary for this
Court to address itself to the ratio decidendi of these cases any further.
C. The High Court has transgressed its jurisdiction under Article 226 of
the Constitution
19. Article 19(1)(g) of the Constitution recognizes the right of citizens to practice
any profession, or to carry on any occupation, trade or business. This right
includes all activities which enable citizens to generate economic benefits
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2
and earn a livelihood. The right recognized in Article 19(1)(g) is not an
unfettered right and the state may impose reasonable restrictions on the
exercise of that right, in terms of Article 19(6).
20. The fundamental aspect which needs to be noted is that the trade and
business of operating cinema theatres is subject to regulation by the state. In
this case, the State Government has framed the 1975 Rules to regulate the
industry. Admittedly, the 1975 Rules do not contain a rule compelling the
owner of a cinema theatre to allow a movie goer to bring food or beverages
from outside within the precincts of the theatre. Similarly, other enactments
and rules which regulate the industry, namely, the Cinematograph Act 1952,
the Cinematograph (Certification) Rules 1983, the Jammu and Kashmir
Cinematograph Act 1989, and the Jammu and Kashmir Cinematograph
Rules 1989 do not contain a provision which requires theatre owners to
permit movie goers to carry food and beverages of their own into the cinema
hall. The rule making power of the state must be exercised consistent with
the fundamental right of the cinema hall owner to carry on a legitimate
occupation, trade, or business within the meaning of Article 19(1)(g) of the
Constitution.
21. The majority opinion of a nine judge bench of this Court in Mafatlal
3
Industries Ltd. v. Union of India was authored by Jeevan Reddy, J. who
held that the High Court must have regard to legislative intent while
exercising its jurisdiction under Article 226:
2
Alagaapuram R. Mohanraj v. T.N. Legislative Assembly, (2016) 6 SCC 82
3
(1997) 5 SCC 536
12
“108 (i). While the jurisdiction of the High Courts under Article 226 — and of
this Court under Article 32 — cannot be circumscribed by the provisions of
the said enactments, they will certainly have due regard to the legislative
intent evidenced by the provisions of the said Acts and would exercise their
jurisdiction consistent with the provisions of the Act … This is for the reason
that the power under Article 226 has to be exercised to effectuate the rule of
law and not for abrogating it.”
22. The legislature’s omission of a provision requiring the cinema owner to allow
eatables and beverages to be brought from outside is significant. In the
absence of a specific mandate in the 1975 Rules (or any other applicable
law) in this regard, the High Court was not justified in issuing a direction
prohibiting theatre owners from disallowing food and beverages to be
brought in by persons entering a movie theatre who enter it for viewing a
film. The High Court has erred in the exercise of its writ jurisdiction under
Article 226 of the Constitution. The exercise of its jurisdiction was not
consistent with the provisions of the enactments regulating movie theatres.
23. The cinema hall is a private property of the owner of the hall. The owner of
the hall is entitled to stipulate terms and conditions so long as they are not
contrary to public interest, safety and welfare . Like with any other business,
the proprietor or the management is entitled to determine the business
model that is to be followed and to give effect to their own conceptions of the
economic viability of a particular business model. The owner of a cinema hall
is entitled to determine whether she will set up or engage an entity for setting
up counters for the sale of food and beverages and to regulate the terms on
which such sale should take place. A prohibition on carrying food and
beverages from outside into the precincts of the movie hall is not contrary to
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public interest, safety or welfare.
24. Of late, multiplexes or movie halls are not operated or envisaged solely as
places where movies are screened. A more accurate characterization of a
movie hall is as an entertainment centre or as an entertainment bundle. The
sale of different kinds of food and beverages forms a portion of the entire
package of entertainment available at the cinema hall. In other words, a
movie hall is not a movie hall alone but also doubles up as an eatery when
food and beverages are sold within its premises. Viewed from this lens, it is
immediately evident that patrons of a movie hall cannot demand to bring
their own food to eat there when a condition to the contrary is enforced by
the cinema hall owners. This would be akin to permitting a customer who
visits a restaurant to carry their own food to that restaurant and eat it within
the premises of that restaurant.
25. Respondents 3 and 4 have urged that they ought to be permitted to carry
their own food because the cinema halls sell exorbitantly priced food and
beverages, which are also not nutritious. The High Court was persuaded to
issue the direction which has been noted earlier based on the consideration
that what is offered for sale is “junk food”. Theatre owners may decide the
contents of the menu they offer, similar to restaurants deciding their menu or
similar to theatre owners themselves deciding which movies to screen. As
mentioned above, this is a commercial decision which the theatre owners
are entitled to make. The price point at which the goods and services will be
sold is likewise subject to being fixed by the movie theatre. Whether or not
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the cost of a good or service is affordable or exorbitant is unrelated to the
conditions of entry enforced by a business.
26. The second level of argumentation in the judgment of the High Court is that
the prohibition in question impinges upon the right to choice of food, the right
not to eat “junk” food, and the right to good health. However, this line of
reasoning fails to notice that movie goers are not compelled to buy food at
the cinema hall. Whether or not to purchase food or beverages after gaining
admission to the cinema hall is entirely within the choice of the movie goer.
Viewers visit cinema halls for the purpose of entertainment. The transaction
of purchasing a ticket permits them to view the movie they have opted to
watch. If the food and beverages on sale at the movie hall are not to their
taste, they are free to refrain from purchasing them. In this way, they are not
being prevented from exercising their right to choice of food. We also note
that the right of movie goers to purchase or eat a dish of their choice is
unfettered outside the confines of privately operated movie theatres (subject
to safety and public welfare).
27. Whether or not to watch a movie is entirely within the choice of viewers. If
viewers seek to enter a cinema hall, they must abide by the terms and
conditions subject to which entry is granted. Having reserved the right of
admission, it is open to theatre owners to determine whether food from
outside the precincts of the cinema hall should be permitted to be carried
inside.
28. We are therefore of the view that the High Court transgressed its jurisdiction
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under Article 226 of the Constitution by directing the cinema hall owners not
to prohibit movie goers from carrying eatables and beverages from outside
within the precincts of a cinema hall and by directing the state to enforce this
direction to the cinema hall owners. Absent a statutory regulation which
regulates the right to conduct the business of operating a cinema hall, the
imposition of such a restraint would affect the legitimate rights of a theatre
owner.
29. However, this is not to say that the terms and conditions imposed by cinema
owners or other commercial entities bind the consumer or the customer in
every case. As held by a catena of decisions of this Court, when one party
has unequal bargaining power relative to the other party, any terms and
conditions which are unreasonable may not be enforced as against the party
4
with lower bargaining power. In v.
Central Inland Water Transport Corpn.
5
Brojo Nath Ganguly , this Court held that whether parties can be said to
have unequal bargaining power and whether a bargain is unfair or
unreasonable must be decided on the facts and circumstances of each case:
“89. … This principle is that the courts will not enforce and will, when called
upon to do so, strike down an unfair and unreasonable contract, or an unfair
and unreasonable clause in a contract, entered into between parties who
are not equal in bargaining power. It is difficult to give an exhaustive list of
all bargains of this type. … It will apply to situations in which the weaker
party is in a position in which he can obtain goods or services or means of
livelihood only upon the terms imposed by the stronger party or go without
them. It will also apply where a man has no choice, or rather no meaningful
choice, but to give his assent to a contract or to sign on the dotted line in a
prescribed or standard form or to accept a set of rules as part of the
contract, however unfair, unreasonable and unconscionable a clause in that
4
Central Inland Water Transport Corporation v. Brojo Nath Ganguly, (1986) 3 SCC 156; IREO Grace Realtech (P) Ltd. v.
Abhishek Khanna, (2021) 3 SCC 241; Jacob Punnen v. United India Insurance Co. Ltd., (2022) 3 SCC 655
5
(1986) 3 SCC 156
16
contract or form or rules may be. … there can be myriad situations which
result in unfair and unreasonable bargains between parties possessing
wholly disproportionate and unequal bargaining power. These cases can
neither be enumerated nor fully illustrated. The court must judge each case
on its own facts and circumstances.”
30. The test in Central Inland Water Transport Corpn. (supra) is not only to
assess whether the parties have unequal bargaining power relative to one
another but also to ascertain whether a contractual term or a contract is
unfair, unreasonable or unconscionable. A contract (or a term in a contract)
can be said to be unfair or unreasonable if it is one-sided or devoid of any
commercial logic. In the present case, although theatre owners may
unilaterally determine the conditions of entry into cinema hall, the condition
imposed in this instance is not unfair, unreasonable or unconscionable.
31. The condition of entry is imposed as a direct result of the exercise of the
right of cinema owners to carry on a business or trade under Article 19(1)(g)
of the Constitution. The commercial logic of prohibiting movie goers from
carrying their own food to the cinema hall is to stimulate and boost a vital
aspect of the business – the sale of food and beverages. If business owners
are not permitted to determine the various facets of their business (in
accordance with law), economic activity would come to a grinding halt. While
movie goers may have no choice but to sign on the proverbial dotted line
(and thereby not carry any food of their own into the theatre) in order to enter
the cinema hall and watch a movie of their choice, this does not by itself
render the condition of entry unfair, unreasonable or unconscionable.
32. Most businesses impose some or the other condition which the customer
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may find less than ideal. For instance, many private museums do not permit
customers to take photographs of the objects on display. This is also true of
many clothing boutiques or jewellery stores. Audience members are often
banned from recording musical performances at concerts. Music festivals,
much like movie theatres, do not permit attendees to carry their own food or
beverages to the venue. Similar is the case with stand-up comedy shows or
plays that are conducted in collaboration with eateries or bars. Although the
customer is paying for a ticket to watch the music performance (or the stand-
up act or the play, as the case may be), the essence of the business model
is to provide a fillip to the revenue generated by another arm of the business.
This being the case, movie goers are bound by the condition of entry
determined by the theatre owners in the instant case i.e., the prohibition on
carrying food and beverages from outside into the precincts of the movie
hall.
33. We note that during the course of arguments, statements were made on
behalf of the appellants that in order to obviate any inconvenience to movie
goers, due arrangements are made for the supply of hygienic drinking water
without levying any charge within the precincts of the cinema hall. Moreover,
it has also been stated that when an infant or young child accompanies a
parent, as a matter of practice, the cinema hall owners have no objection to
a reasonable amount of food or beverages being carried inside the cinema
hall to serve the nutritional requirements of the infant or child.
34. As for movie goers with chronic diseases who may have received dietary
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instructions from their doctors or who may otherwise be under dietary
restrictions due to their medical condition, we request cinema hall owners to
consider requests from such movie goers on a case-by-case basis.
35. In view of the above position, we allow the appeals and set aside the
impugned judgment and order of the High Court dated 18 July 2018 in
regard to direction (i) which has been referred to above. The remaining
directions of the High Court do not form the subject matter of the appeals
and are, therefore, not dealt with in the present judgment.
D. Parting remarks
36. Before concluding, it needs to be noticed that Rule 87 of the 1975 Rules is in
the following terms:
“87. (i) The licensing authority shall ensure that the sale price of tickets in all
the cinemas of the State holding licence under these rules in uniform.
(ii) The licensing authority shall ensure that reduced rates are charged by
the licensee for any picture screened for the second time in any auditorium.”
37. The validity of Rule 87 was not in challenge before the High Court. The High
Court in paragraph 8(iii) of its judgment issued the following directions in
regard to sub-clauses (i) and (ii) of Rule 87:
“iii. The Government of J&K as well as Licensing Authority/every District
Magistrate in the State is directed to ensure proper uniformity be maintained
with respect to the sale price of tickets in all the cinemas of the State in
terms of Rule 87(i) & (ii) of the Jammu & Kashmir Cinemas (Regulation)
Rules, 1975.”
38. The above direction of the High Court shall not be construed as imposing
any requirement over and above Rule 87 as it currently stands.
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39. Pending applications, if any, stand disposed of.
TC (C) Nos 28 of 2019 and 29 of 2019
40. In view of the judgment delivered above in Civil Appeal No. 77 of 2023, the
writ petitions transferred from the High Court of Delhi in TC (C) No 28 of
2019 and the Bombay High Court in TC (C) No 29 of 2019 are dismissed.
The Transferred Cases are accordingly disposed of.
41. Pending applications, if any, stand disposed of.
..………..…....…........……………….…........CJI.
[Dr Dhananjaya Y Chandrachud]
……….…..…....…........……………….…........J.
[Pamidighantam Sri Narasimha]
New Delhi;
January 03, 2023
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