Kodungalloor Municipal Council vs State of Kerala

K.A. Abdul Gafoor, J.—Petitioner in O.P. No. 13876/92 is the Kodungallur Municipal Council represented by the Chairman. It is disputed whether the Chairman can represent a Municipal Council. The Council can be represented only by the Commissioner as it then stood and now by the Secretary in terms of the new Act. The O.P. No. 4728/93 is filed by two citizens residing within the jurisdiction of the Kodungallur Municipality and first petitioner claims himself to be the convenor of "Cinemaswadaka Sangham" functioning in Kodungallur from 1988 onwards. All of them challenge the order marked as Ext. P9 in O.P. No. 13876/92-B which is Ext. P1 in O.P. No. 4728/93. In form Ext.P1 is a letter addressed from the Government, Local Administration Department to the Municipal Commissioner (through Chairman) Kodungallur Municipality, wherein it is made clear that "As per the provisions of law contained in the Kerala Local Authorities Entertainment Tax Act it is the privilege of the Proprietor to fix the rate for admission to the theatres concerned and the Municipality''s duty is only to revise the Entertainment tax". It is further stated that "Neither the Commissioner nor the Government have got any discretion under the law to fix the rate of admission." Ext.P9 is challenged by the petitioners as the said order gives unbridled power to the theatre owners to fix the rate of admission. It is further submitted by the petitioners that the theatre owners cannot fix unilaterally rate of admission. The maximum ceiling has to be specified by the licencing authority concerned in terms of the ''Kerala Cinema (Regulation) Act, 1958. It is their further submission that Ext.P9 is not an order by Government and it is unauthorised. It is further submitted that Ext.P9 is arbitrary to the extent it confers power to the Cinema Owners to fix the rate of admission to the Cinema theatres, that itself take away the regulatory measures ensured under the said Act and Rules. Counsel for the respondents No. 3 to 7 submit that Ext.P9 is an order passed by Government in an appeal filed by the Cinema theatre owners resorting to the provision contained in second part of special condition No. 3 in the licence. Therefore, there is no arbitrariness in Ext.P9. Moreover, on the basis of the subsequent interim order, the rates were revised by the licencing authorities upon application by the theatre owners and therefore the issue has become infructuous.

But one thing is clear that the views of the Government have been made clear in Ext.P9 that the licencing authority has no role in the fixation of rate of admission and that it is the exclusive domain of the theatre owners. Whether this is correct is the issues involved, inspite of the subsequent revision in the admission ticket rate.

Section 3 of the Cinema Regulation Act, 1958 reads as follows:

Save as otherwise provided in this 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 any conditions and restrictions imposed by such licence.

(Emphasis supplied)

Cinema owner gets an authority to exhibit cinema only on the basis of a licence to be granted under that Act and that licence is subject to the conditions, and restriction contained in the licence. The executive authority of the local authority is the licencing authority in terms of Section 4 of the said Act. A licencing authority has several restrictions as contained in Section 5 of the said Act. Rule 14 of the rules framed under the said Act provides that the licencing authority shall issue licence in duplicate in Form ''E'' The Form ''E'' is one statutorily prescribed. Item No. 10 of the licence contains special conditions. The special condition No. 3 reads as follows:

The maximum rates of payment for admission to the different classes in the licenced premises shall be as indicated below and these rates shall not be increased during the currency of this licence without an order, in writing, of the licensing authority permitting such increase. The order of the licensing authority in this regard is liable to be cancelled or modified by the State Government, if they consider such a course just and necessary.

Thus, it is based on this special condition the licence has been issued. This special condition gives power to the licencing authority to fix maximum rate of admission. That being a statutory prescription, Government cannot say that fixation of maximum rate for admission ticket is within the complete domain of the cinema owners. It runs contra to the regulations intended for the Cinema (Regulations) Act and the Rules framed thereunder. Therefore the view taken by the Government is contrary to the statutory conditions contained in the licence. So, Ext.P9 is liable to be quashed on that ground.

It is contended that Ext.P9 was issued in exercise of the appellate powers of Government. Government derives this appellate power from the second part of the special conditions No. 3 contained in the licence. That appeal is available only to one who is aggrieved. Grievances occurs when the maximum rate is lower than that the cinema owner requests for. Therefore, the primary basis for the appeal is the power vested in the licencing authority to fix the rate or to fix the maximum rate. Without that, there will arise no appeal, that the cinema owners preferred an appeal against the order of the licencing authority itself shows that there is power for the licencing authority to fix maximum rate. On this reason also the views contained in Ext.P9 are illegal.

Second part of the special condition No. 3 in the Licence confers the appellate powers on the ''State Government''. The appellate power of the State Government can be exercised as the State Government exercises it''s executive functions. In terms of Article 166 of the Constitution of India, all executive action of the Government of a State shall be expressed to be taken in the name of Governor, then alone it will take form of a Government action or expression of opinion by Government or discharge of the function by the Government. Ext.P9 shows that is not an order issued in terms of Article 166 of the Constitution of India, by order of the Governor. It is a letter signed by the Under Secretary, for the Secretary to Government. So, the appeal has to be disposed of by the State Government as provided in Article 166 of the Constitution of India read with the rules made by the Governor. On this reason also Ext.P9 is liable to be quashed.

The relevant statute governing the issue in Cinema (Regulation) Act 1958. But in Ext.P9, Government took note of Kerala Local Authorities Entertainment Act. Thus there is no proper application of mind or due advertence to the relevant law. On this reason also Ext.P9 cannot be sustained. Though the petitioner in O.P. No. 13876/92 is not properly described, in effect the Chairman has approached this Court, with a real cause. So, the original petitions are allowed, Ext.P9 is quashed. Cinema owners can continue the exhibition as per the present rate subject to their right to request for revision and subject to the rights of the licencing authority to fix the maximum rate of admission.

Original petitions are allowed.