State of Gujarat & ANR Vs. M/S.
Krishna Cinema & Ors [1970] INSC 185 (10 September 1970)
10/09/1970 GROVER, A.N.
GROVER, A.N.
SHAH, J.C.
SHAH, J.C.
HEGDE, K.S.
SHAH, J.C.
HEGDE, K.S.
CITATION: 1971 AIR 1650 1971 SCR (2) 110
ACT:
Bombay Cinemas (Regulation) Act 11 of 1953
and Rules--Rule 89 does not prohibit construction of cinema building before
grant of no objection certificate by Licensing AuthorityDirection given by
State Government to Licensing Authority vitiated if there is no application of
mind to factsAppellate order under s. 8A must give reasons--Use of words
'absolute discretion' in s. 5(2) of Chapter If does not invest State Government
with arbitrary power.
HEADNOTE:
The Bombay Cinemas (Regulation) Act 11 of
1953 and the rules made there under were made applicable to the territory of
the State of Gujarat by the Bombay Reorganisation Act, 1960.
Under s. 3 of Act It of 1953 films can be
exhibited only in licensed premises. By s. 4(3) the District Magistrate is,
where there is no Commissioner of Police, the Licensing Authority. By s. 5 the
Licensing Authority is subject to the control of the State Government. A person
aggrieved by the order of the Licensing Authority has under s. 8A a right of
appeal to the State Government. Rule 5(2) authorises the Government on
consideration of the report of the Licensing Authority, in its absolute
discretion to grant permission for the issue of a no objection certificate to
the applicant or to refuse to grant the same. By r. 89 it is enacted that no
person shall put up any building or structure or convert existing premises for
being used as a cinema except with the permission in writing of the Licensing
Authority.
The respondents carried on the business of
exhibiting cinematograph films in a theatre named Krishna Cinema at Rajkot. On
May 14, 1963 they applied to the District Magistrate for a 'no objection
certificate' to the user of a building to construction as an 'annexe' to the
Krishna Cinema, The Magistrate sanctioned the construction of the building and
the plans submitted by the respondents were approved by the Executive Engineer.
On completion of the building the Executive Engineer recommended the grant of a
'no objection certificate'. Thereafter the District Magistrate in his report of
the State Government suggesting that a no objection certificate be granted even
though the construction of the building before the grant of the certificate was
against the rules. The Government of Gujarat intimated by a letter dated July
9, 1964 written by the Add. District Magistrate, Rajkot that the application
filed by the respondents could not be granted,. An appeal filed against the
order communicated by the Addl. District Magistrate to the State Government was
rejected. The respondent filed a writ petition in the High Court which
succeeded. The State of Gujarat appealed to this Court relying on r. 89 for
their contention that the building was constructed in violation of the rules
and, therefore, the refusal of a 'no objection certificate' was justified.
Dismissing the appeal,
HELD : (1) Rule 89 authorises the Licensing
Authority to allow conversion of an existing building into a cinematograph
theatre. Therefore the completion of the building before the Government
considered the request to a 'no objection certificate' did not constitute a bar
to the exercise of jurisdiction to grant the certificate and District
Magistrate was right in his view that the certificate applied for must be
granted. [II S B-C] 111 The 'annexe' complied with all the requirements of the
rules, but by letter dated July 9, 1964 the Licensing Authority under
instructions of the State Government informed the respondent that application
for constructing a permanent annexe near the present Krisha Cinema and for
obtaining a 'no objection certificate' was not admissible.
The building had been constructed several
months before the date on which the letter was written. The contents of the
letter created an impression that in the view of the authorities the building
had still to be constructed. It was clear that the authority did not apply its
mind to the application. It did not consider whether a building which was
already in existence should be allowed to be converted into a cinematograph
theatre. [116 A-C] Further in dismissing the appeal preferred to the State Government
it was recorded that the Government did 'not see any reasons to change the
decision already taken by the District Magistrate'. The order of the State
Government which was a reaffirmation of its original decision communicated
through the Licensing Authority gave no indication that the objections raised
in the memorandum of appeal were considered. No reasons in support of the order
were set out. [116 C-D] Since the State Government did not correctly apprise
itself of the facts when it gave its directions to the Licensing Authority to
dismiss the application and later dismissed the appeal without. giving any
reasons, its order giving directions to the District Magistrate and in appeal
were rightly set aside by the High Court. [117 A-B] (ii)Power to control the
Licensing Authority under s. 5 is not power to supplant the Licensing
Authority. The power to grant a licence under the Act is a quasi-Judicial power
and by the use of the Expression 'absolute discretion' in r.
5 it is not intended to invest the Licensing
Authority with arbitrary power so as to destroy the limitations to which it is
subject by its inherent nature. [116 G-H] [The court found it unnecessary for
the purpose of the case to express any opinion on the propriety or validity of
provisions making exercise of quasi-judicial power subject to the control, at
the stage when it was exercised, of the executive. It observed however that a
right of appeal Linder s. 8A the State Government against the order of the
Licensing Authority issued under the order of the State Government was a futile
formality and served no useful purpose. [114 F-H]
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 1435 of 1970.
Appeal by special leave from the judgment and
order dated August 12, 13, 1969 of the Gujarat High Court in Special Civil
application No. 919 of 1969.
S.K. Dholakia, B. D. Sharma and S. P. Nayar
for the appellants.
A.K. Sen, H. R. Gokhale, J. L. Hathi, K. N.
Bhat and K. L. Hathi, for the respondents.
The Judgment of the Court was delivered by
Shah, J. The respondents in this appeal carry on the business of exhibiting
cinematograph films in a theatre named Krishna 112 Cinema at Rajkot. On a plot
of land adjacent to the Krishna Cinema the respondents desired to construct
"an annexe" for exhibiting foreign films with independent screen and
auditorium. On May 14, 1963 the respondents applied to the District Magistrate
who is the Licensing Authority under the Bombay Cinemas (Regulation) [Act 11 of
1953] for a 'no objection certificate' to the user of the "annexe" to
be constructed on the site for exhibiting cinematograph films.
On the same day they submitted to the
Executive Engineer plans of the proposed building of "annexe" to be
used as a cinematograph theatre. They also applied to the local Municipality
for leave to construct a building to be used for cinematograph theatre. The
Municipality sanctioned construction of the building. The Executive Engineer
also signified his assent by letter addressed to the Additional District
Magistrate to the grant of a "no objection certificate".
By an application submitted on May 14, 1963
the respondents prayed that a "no objection certificate" under the
Bombay Cinemas (Regulation) Act be granted in respect of the "annexe"
to be constructed. As required by the rules framed under the Act the District
Magistrate notified the application and invited objections to the proposal. The
District Magistrate then forwarded his report to the Government of Gujarat that
according to the rules the respondents should have commenced construction of
the " annexe" only after obtaining the 'no objection certificate'
under the Act, but since the building was constructed with the sanction of the
Municipality and the building was in conformity with the rules, he recommended
that the "no objection certificate" be granted. The Government of
Gujarat intimated by a letter written by the Additional District Magistrate,
Rajkot that the application filed by the respondents could not be granted. An
appeal filed against the order communicated through the Additional District
Magistrate to the State Government was rejected and the respondents were asked
not to make any further representations in that behalf.
The respondents then filed a petition in the
High Court of Gujarat for a declaration that r. 5 sub-r. (2) of the Bombay
Cinema Rules, 1954, infringes Art. 19(1)(f) & (g) of the Constitution and
for a direction calling upon the Government of the State of Gujarat to grant
'no objection certificate' as applied for by them for setting up a cinematograph
theatre in the "annexe" and for an order quashing or setting aside
the communications from the District Magistrate and the order in appeal passed
by the State of Gujarat and to direct the State of Gujarat and the District
Magistrate to consider the application of the respondents for 'no objection
certificate' in accordance with law. The High Court of Gujarat upheld the
contention raised by the respondents and set aside the orders of the State
Government and of the District Magistrate.
113 The High Court directed that a writ of
mandamus be issued directing the State Government to permit the District
Magistrate to issue a 'no objection certificate' and the District Magistrate to
issue such a. certificate to the respondents as prayed in their application.
The State of Gujarat has appealed to this Court with special leave.
Exhibition of cinematograph films and
licensing of places for such exhibition is governed by the Bombay Cinemas
(Regulation) Act 11 of 1963. By virtue of the provisions contained in the
Bombay State Reorganisation Act, 1960, the Act and the Rules are applicable to
the territory of the State of Gujarat. By S. 3 of the Bombay Cinemas
(Regulation) Act 1953, "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 the Act or otherwise than in compliance with any conditions and
restrictions imposed by such licence". In the town of Rajkot, by virtue of
S. 4(3) of the Act the District Magistrate is the Licensing Authority. By
sub-s. (1) of s. 5 the Licensing Authority is prohibited from, granting a
licence unless it is satisfied that the rules made under the Act have been
substantially complied with and adequate precautions have been taken in the
place, in respect of which the licence is to be given, to provide for the
safety of persons attending exhibition therein. By s. 5(2) subject to the
provisions of sub-s. (1) and to the control of the State Government the
Licensing Authority may grant licences under the Act to such persons as that
Authority thinks fit..
Section 7 authorises the Licensing Authority
with power to revoke or suspend a licence. Any person aggrieved by an order of
a Licensing Authority, inter alia, refusing to grant a licence or revoking or
suspending any licence, may under S. 8A appeal to the State Government s. 9
provides for the making of the rules for the purpose of carrying into effect
the provisions of the Act. By r. 3, insofar as it is relevant it is provided :
"(2) Any person desirous of erecting a cinema
or converting existing premises into a cinema shall first make public his
intention to do so by exhibiting a notice in Form "A" on a board on
the proposed site in such a position that it can be plainly seen from the
public through fare upon which the site of such proposed cinema abuts.
(3)Such person shall also give a similar
notice in writing to the Licensing Authority and make an application to the
Licensing Authority for the grant of a "No objection" Certificate
specifying therein whether the 114 application is in respect of a permanent
cinema or a touring cinema." By r. 4 provision is made for inviting
objections on receipt of a notice from the applicant' Rule 5(2) authorises the
Government, on consideration of the report of the Licensing Authority, in its
absolute discretion to grant permission for the issue of a "No objection
certificate" to the applicant or to refuse to grant the same. Chapter III
of the Rules prescribes rules relating to buildings to be used for
cinematograph theatres. Chapter IV prescribes rules relating to electric
installation and Chapter V prescribes precautions against fire. By r. 89 which
occurs in Chapter VI it is enacted that "no person shall put up any
buildings or structure or convert existing premises for being used as a cinema
except with the previous permission in writing of the Licensing
Authority." Rules 90 provides for the making of an application for permission.
Rule 91 provides for submission of the plans along with the application. Rule
92 provides for the approval by the Public Works Department of the plans and r.
93 for permission to build. Rule 94 provides that the applicant shall complete
the construction.
of the cinema within a period of two years
from the date of the permission or within such extended period as may be
allowed by the Licensing Authority.
Under the Act the District Magistrate is, in
places where there is no Commissioner of Police, constituted the Licensing
Authority. By S. 5 the power of the Licensing Authority is subject to the
control of the State Government.
Authority to license a cinematograph theatre
is therefore vested in the Licensing Authority subject to the overriding
control of the State Government. It is difficult to appreciate what purpose may
be served by giving a right to appeal to the State to a person aggrieved by the
order of the Licensing Authority, if the original order is made under the
direction and subject to the control of the State Government. A right of appeal
under s. 8A against the order of the Licensing Authority issued under the order
of the State Government is a futile formality and serves no useful purpose.
Power to issue, revoke or suspend a licence conferred upon the District
Magistrate is exercisable on satisfaction of that officer of certain objective
conditions and is 'Plainly quasi-judicial. But exercise of power by the
Licensing Authority to grant a licence is still made subject to the control of
the State Government. It is unnecessary for the purpose of this case to express
any opinion on the propriety or validity of provisions making exercise of.
quasi-judicial power subject to the control, at the stage when it is exercised,
of the executive.
From the affidavit filed on behalf of the
State Government it appears that the only grounds of objection to the grant of
the no 115 objection certificate' was that contrary to the terms of r. 89 the
respondents had constructed the "annexe" before the State Government
considered their application for a "no objection certificate". It
appears however from the report of the Licensing Authority that plans of the
building intended to be constructed complied with the rules framed under the
Act and the building constructed did not contravene the provisions of the Act
and the Rules. Rule 89 authorises the Licensing Authority to allow conversion
of an existing building into a cinematograph theatre. Therefore the completion
of the building before the Government considered the request for a "no
objection certificate" did not constitute a bar to the exercise of
jurisdiction to grant the certificate and the District Magistrate was right in
his view that the certificate applied for should be granted.
A proposal for setting up a cinematograph
theatre in a Municipal area has to be cleared by three authorities.
First is the Municipal Authority which must
sanction the proposed construction. For that purpose building plans have to be
submitted and construction has to be completed within one year from the date of
sanction. Again the application for putting up a building to be used as a
cinematograph theatre must be accompanied by plans to be approved by the Public
Works Department, and the building may be constructed only after permission is
granted by the Public Works Department. The building so permitted must be
completed within two years from the date of permission or such extended period
as may be allowed by the Licensing Authority. The third is the Licensing
Authority who under s. 4 read with ss. 3 and 5 (1 ) has the power to issue a
licence under the Act. Somewhat inconsistently r. 5 (2) states that the
Government may grant the "No Objection Certificate" which for some
unexplained reason is used as a synonym for "Licence" in the Act.
In the first instance the Rajkot Municipality
sanctioned construction of the "annexe" by the respondents by letter
dated May 28, 1963 and the Executive Engineer by letter dated September 13,
1963 informed tile Licensing Authority copy of which information was sent to
the respondents-that the former had "-no objection to issue sanction for
the construction of "annexe" to the existing Krishna Cinema".
It was also recorded in the letter that the
respondents had agreed to carry out modifications in the plan as may be
suggested by the Executive Engineer. At the foot of the letter was a note that
"the suggestions in accordance with the Bombay Cinema Rules, 1954"
were being forwarded to the respondents separately.
The respondents then applied by letter dated
January 2, 1964 to the Licensing Authority. that the "annexe" had
already been constructed and the sanction to use it as a cinematograph theatre
116 may be granted. The "annexe" complied with all requirements of
the rules, but by letter dated July'9, 1964 the Licensing Authority under the
instructions of the State Government informed the respondents that "application
for constructing a permanent annexe near the present Krishna Cinema and for
obtaining a 'no objection certificate' is not admissible".
The building had been constructed several
months before the date on which that letter was written. The contents of the
letter create an impression that in the view of the authorities the building
had still to be constructed. It is clear that the authority did not apply its
mind to the application. It did not consider whether a building which was
already in existence should be allowed to be converted into a cinematograph
theatre.
In dismissing the appeal preferred to the
State Government it was recorded that the Government did "not see any
reasons to change the decision already taken by the District Magistrate"
and that decision was communicated to the respondents by letter dated July 9,
1964. The order of the State Government which is a reaffirmation of its
original decision communicated through the Licensing Authority gives no
indication that the objections raised in the memorandum of appeal were
considered. It sets out no reasons in support of the order. The authority which
made the order on behalf of the State Government appears to have been
,oblivious of the circumstances in which the building was constructed. The
Government did not consider whether a building already in existence which
complied with all the requirements of the Rules should be allowed to be
converted into a cinematograph theatre.
It was urged on behalf of the State
Government that under r.5 (2) in Chapter 11 the State Government has absolute
discretion to grant permission for the issue of a "no objection
certificate" to the applicant. Under the Act the District Magistrate and
not the State Government is the Licensing Authority. Granting that the State
Government may validly control the exercise of power by the Licensing
Authority, on that question we express no opinion the State Government cannot
relying upon the Rules assume to itself the jurisdiction of the Licensing
Authority to issue the licence. Power to control the Licensing Authority under
s. 5 is not the power to supplant the Licensing Authority.
Again the, power to grant a licence under the
Act is quasijudicial, and by the use of the expression "absolute
discretion" it is not intended to invest the Licensing Authority with
arbitrary power so as to destroy the limitations to which it is subject by its
inherent nature.
The Act does not purport to confer arbitrary
authority upon the Licensing Authority or the State Government, and by the use
in the rule-, of the expression absolute discretion the legislative intent
disclosed by the Act cannot be superseded.
117 It is clear on a perusal of the record
that the State Government did not correctly apprise itself of the facts when it
gave its directions to the Licensing Authority to dismiss the application, and
the State Government also acted in violation of the rules which inhere the
exercise of judicial power when it dismissed the appeal without giving reasons.
The orders dated July 9, 1964 and August 1964 were rightly set aside by the
High Court.
The appeal therefore fails and is dismissed
with costs.
G.C. Appeal dismissed.
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