ORDER
S. Ananda Reddy, J.
1. This Writ Petition is filed by Petitioner aggrieved by the order passed by the 1st Respondent-Licensing Authority, under which a fine of Rs. 10,000/- was imposed for the alleged violation of the conditions of Licence and the Petitioner seeking declaration that the said impugned order is illegal, void and without jurisdiction and for a consequential order setting aside the impugned proceedings.
2. The Petitioner is carrying on the business of running a cinema theatre, having obtained a valid licence under the provisions of the Andhra Pradesh Cinemas (Regulation) Act, 1955 (hereinafter referred to ‘the Act’) and the Rules made thereunder. It is stated that while so the Petitioner was issued a show cause notice dated 13.3.1992 calling upon the Petitioner to show cause why a penalty of Rs. 10,000/- should not be imposed for violation of Section 4(5) of the A.P. Entertainment Tax Act and also Condition 20 of the Item 12 of Form-B Licence. In response to the said notice, the Petitioner submitted its explanation dated 10.4.1992 stating that the Petitioner has not violated any of the provisions of the Act or the A.P. Entertainment Tax Act or any of the Conditions of Licence. Thereafter, the 1st Respondent, after hearing the Petitioner, passed orders imposing a penalty of Rs. 10,000/-. It is further stated by the Petitioner that there is a revision of rates of admission as well as the seating capacity, which came into effect only from 24.3.1992, but not from any earlier date. A written explanation also said to have been submitted to the Entertainment Tax Officer, Kama Reddy with reference to the said fact. But, however, according to the Petitioner, the 3rd Respondent, who enquired into the matter, without properly verifying the facts, came to the conclusion that the Petitioner was collecting Rs. 4-00 for admission into the balcony, while showing the collection at Rs. 3-00 to the Entertainment Tax Officer. The said report of the 3rd Respondent is only one sided. Even with reference to the violation of the Conditions of Licence, it was contended that there is no material for the Respondents to come to that conclusion. Ultimately it is stated that the fine of Rs. 10,000/- imposed is too excessive and therefore, liable to be quashed.
3. At the time of hearing, the learned Counsel for the Petitioner contended that under the provisions of the Act if the Petitioner has committed any offence, it has to be dealt with under Section 9 of the Act for which only a Criminal Court having jurisdiction alone is competent and no criminal complaint was filed and no Criminal Court has convicted the Petitioner and therefore, the imposition of fine by the Licensing Authority, is illegal and without jurisdiction. The learned Counsel also contended that for taking any action under the provisions of the Act by the Licensing Authority, conviction is a must under Section 9 and in the absence of any such conviction, the authority has no right or power to impose penalty or any other punishment. The learned Counsel also relied upon the judgment of this Court in the case of Nirmal Talkies, Adoni v. District Revenue Officer, 1984 Crl. LJ 929, wherein it was held that with reference to an offence under Section 9, it can be tried and penalty imposed only by Criminal Court, and the Licensing or the revenue authorities have no jurisdiction. To the same effect is the decision of another learned Single Judge of this Court in the case of Liberty Cinema v. The Commissioner of Police, Hyderabad, 1987 (1) L.S. 62, wherein it was held that imposing a penalty under Section 9, the Commissioner of Police, who has imposed punishment, has no jurisdiction and it is only the Judicial First Class Magistrate competent to try the offence. Therefore, the learned Counsel contended that the Licensing Authority has no jurisdiction to pass the impugned order.
4. A counter has been filed on behalf of the Respondents disputing and denying the allegations. In the counter it is contended
that the Petitioner had violated the conditions of licence, which includes the violation of the provisions of the Entertainment Tax Act by collecting the amounts without properly issuing the stamped and printed tickets, by charging higher amount than what was accounted for payment of the tax. In the counter it is also stated that the Petitioner had violated the other conditions by not keeping the toilets clean and under hygienic conditions and also closing two of the W.Cs. Therefore, it was contended that the licensing authority has got the power to impose the fine, as contemplated under Section 12 of the Act.
5. At the time of hearing, the learned Government Pleader contended that though the provisions of Section 9 were wrongly referred, but the licensing authority passed the impugned order exercising the powers conferred upon him under Section 10(2) and 10(2-A) of the Act. It is also contended that mere reference to a wrong provision, the jurisdiction of the officer cannot be held to be illegal. The learned Counsel also relied upon judgment of this Court in Sapna 35 MM v. Government of A.P., 1988 (2) ALT 450, where a learned Single Judge of this Court while considering the provisions of Section 10(2) and 10(2-A) held that the licensing authority has got the power to impose fine. The learned Counsel also referred to the conditions contained in B-Form Licence and stated that the Petitioner had violated the Condition Nos. 20 as well as 46 of the licence. Therefore, the impugned order, imposing a fine of Rs. 10,000/- passed by the licensing authority is proper and just.
6. In reply, the learned Counsel for the Petitioner contended that though the maximum penalty imposable is Rs. 10,000/-, unless there are justifiable reasons recorded in the impugned order, the licensing authority cannot impose such maximum penalty. As there are absolutely no reasons recorded by the licensing authority, the maximum penalty levied is not sustainable.
7. From the above rival contentions, the issue to be considered is whether the impugned order passed by the licensing authority imposing a fine of Rs. 10,000/- for violation of the conditions of the licence is proper and just.
8. Before considering the rival contentions, it is proper to refer to the relevant provisions of the Act, which are as under:
“Section 9: Penalties :–If the owner or person in charge of the cinematograph uses the same or allows it to be used, or if the owner or occupier of any place permits that place to be used, in contravention of the provisions of this Act, or of the rules made thereunder or of the conditions and restrictions upon or subject to which any licence has been granted under this Act, he shall be punishable with fine which may extend to ten thousand rupees and, in the case of a continuing offence, with a further fine which may extend to two hundred rupees for each day during which the offence continues.
Section 10. Power to revoke or suspend Licence :–(1) Where the holder of a licence has been convicted of an offence under Section 7 of the Cinematograph Act, 1952, or Section 9 of this Act, the licence may be revoked by the licensing authority.
(2) If the licensing authority is satisfied, either on a reference made to it in this behalf or otherwise, that–
(a) a licence granted under this Act has been obtained by misrepresentation or fraud as to an essential fact, or
(b) the licensee has, without reasonable cause failed to comply with any of the provisions of this Act or of the rules made thereunder, or any of the conditions of restrictions upon or subject to, which the licence has been granted.
And then without prejudice to any other penalty to which the licensee may be liable under this Act, the licensing authority may, after giving the licensee an opportunity of showing cause, revoke or suspend the licence.
(2-A) Where a licence is liable to be revoked or suspended under Sub-section (2), the licensing authority may, not withstanding anything in Sub-section (2) and for good and sufficient reasons to be recorded in writing, impose on the licensee a sum not exceeding rupees ten thousand by way of penalty in lieu of such revocation or suspension.”
9. A perusal of the above shows that Section 9 contemplates levy of penalties for contraventions mentioned therein and for any contravention found by the competent authority, the owner of the theatre shall be punishable with a fine, which may extend to Rs. 10,000/- and in the case of continuing offence with a further fine which may extend to Rs. 200/- per each day during which the offence continues. So far as Section 10 is concerned, it provides for revocation or suspension of the licence. Under Sub-section (1) of Section 10, if the holder of a licence has been convicted of an offence under Section 7 of the Cinematograph Act, 1952 or Section 9 of the Act, the licence may be revoked by the licensing authority. Similarly, under Sub-section (2), if the licensing authority is satisfied that the licence granted under the Act has been obtained by misrepresentation or fraud, or the licensee has, without reasonable cause, failed to comply with any of the provisions of the Act or the Rules made thereunder, or any of the conditions of the licence, then, without prejudice to any other penalty to which the licensee may be liable under the Act, the licensing authority may revoke or suspend the licence. Under Sub-section (2-A), the licensing authority may also in lieu of revocation or suspension of the licence may levy penalty for the reasons to be recorded in writing, a sum not exceeding rupees ten thousand.
10. From the above it is clear that the provisions contemplated that there may be two parallel proceedings – one is proceedings under Section 9 and another is under Section 10 where the licensing authority may impose appropriate punishment as provided therein. No doubt with reference to the punishment contemplated under Sub-section (1), the conviction under Section 9 is contemplated, while for imposing the other punishments, such conviction is not required. In the present case, admittedly, the licensing authority found that the Petitioner had violated the provisions of the Entertainment Tax Act by admitting the persons into the ‘Balcony Class’ without printed tickets as well as charging higher rates for admission than what was permitted. Similarly, with reference to the hygienic conditions to be maintained with reference to the toilets and also the maintenance of W.Cs., the authorities found that the Petitioner had violated the conditions of the licence. Therefore, a show cause notice was issued and subsequently, imposed a fine of Rs. 10,000/-. But, however, the licensing authority while passing the impugned order referred to the provisions of Section 9, instead of Section 10. The learned Government Pleader, therefore, contended that mere referring to a wrong provision may not oust the jurisdiction of the licensing authority, when it is traceable to a provision, which confers such power. No doubt, a reference to Section 10 clearly shows that the licensing authority has got such power to impose the fine. At the time of hearing, the learned Counsel for the Petitioner contended that no reasons have been recorded for imposing maximum fine. But a perusal of the provisions of the Act does not contemplate the reasons to be recorded for imposing the quantum of fine, but what is contemplated under Sub-section (2-A) of Section 10 is the reasons have to be recorded while imposing fine in lieu of revocation or suspension of the licence. No doubt a perusal of the impugned order shows that
the licensing authority did not record any reasons, but only, while exercising the powers vested in him, imposed the penalty of rupees ten thousand. The learned Counsel contended that the contraventions or violations alleged are not so serious as to levy a maximum penalty of Rs. 10,000/- and, hence, sought to reduce the same. For that the learned Counsel also relied upon judgment of this Court in Sapna 35 MM v. Government of A.P. (supra), where a learned Single Judge of this Court has even reduced the penalty in that case. But a perusal of the facts of that case shows that the maximum penalty of Rs. 10,000/- was imposed for violation of the conditions and the said violated condition is as to the non-functioning of the Air Conditioner. But, here, admittedly, the Petitioner was found admitting the persons into ‘Balcony Class’ without issuing printed tickets as well as charging higher rates than the permitted rates, apart from not keeping the toilets hygienically and also closing two of the W.Cs., available to the public. Under the above circumstances, I do not find that there are any justifiable grounds, warranting any interference with the impugned order, even to reduce the penalty imposed by the licensing authority.
11. Therefore, the Writ Petition is devoid of merits and the same is accordingly dismissed. No costs.