License cancellation requires satisfaction based on objective material; mere pendency of criminal cases cannot justify revocation.

The Petitioner, a proprietor of a restaurant and bar, held a Performance Licence (No. 515 of 2009) under Rule 109 of the Rules of Licensing and Controlling place of Public Amusement (other than Cinemas), 1960.

Police conducted raids on 28 February 2024 and 8 June 2024, alleging multiple breaches including stage alteration, unauthorized shifting of the orchestra stage, indecent dancing, and exceeding the permitted number of singers.

Following a show-cause notice dated 11 October 2024, the Competent Authority cancelled the Petitioner's licence on 7 July 2025, citing violations of Rules 102, 122-B, 124, 219, 232, and 233, as well as the pendency of 12 criminal cases.

The Appellate Authority dismissed the Petitioner's appeal on 13 February 2026.

The Petitioner challenged these orders under Articles 226 and 227 of the Constitution of India.

1. Whether the Competent Authority validly arrived at a subjective satisfaction regarding the breach of license conditions in the absence of the underlying inspection reports and spot panchnamas.

2. Whether the mere pendency of criminal cases against an establishment constitutes a legally sustainable ground for the cancellation of a performance licence.

The court primarily applied Rule 238(1) and (3) of the Public Amusement Rules, 1960, which empowers the Licensing Authority to suspend or cancel licences for contravention of rules, provided the licensee is given an opportunity to show cause.

It relied on the principle from Krishna B Shetty v. State of Maharashtra, which mandates that all records, including police reports and panchnamas, must be placed before the authority to arrive at a finding of fact.

Furthermore, the court applied the doctrine established in Dilip J Bhatia v. The Commissioner of Police, Thane and Maruti Vitthal Gopale v. The State of Maharashtra, holding that mere pendency of a prosecution cannot be a ground for licence revocation as allegations are yet to be proved at trial.

The Court observed that the Competent Authority based its decision solely on summary "Reports of violation" dated 9 March 2024 and 10 June 2024.

The Court noted that the actual FIRs and spot panchnamas were never placed before the Competent Authority during the proceedings.

Consequently, the authority was disabled from forming an informed or objective opinion regarding the alleged violations, rendering the decision-making process administratively infirm.

Regarding the criminal cases, the Court emphasized that since the indictments were in the realm of allegations and had not resulted in convictions, visiting the Petitioner with the civil consequence of licence revocation was premature and legally unsustainable.

The Appellate Authority further erred by failing to independently evaluate these legal deficiencies.

The Court allowed the petition and quashed the orders dated 7 July 2025 and 13 February 2026.

The performance licence (No. 515 of 2009) was ordered to be restored forthwith.

Writ Petition No. 1528 of 2026 and Interim Application No. 1468 of 2026 were disposed of accordingly.