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Sujatha Touring Talkies and ors. Vs. State of Karnataka and ors. - Court Judgment

LegalCrystal Citation
SubjectConstitution
CourtKarnataka High Court
Decided On
Case NumberWrit Petition Nos. 8569 to 8589 etc. of 1984
Judge
Reported inAIR1986Kant21; ILR1985KAR2477
ActsKarnataka Cinemas (Regulation) Act, 1964 - Sections 19(2); Constitution of India - Articles 14, 19, 19(1), 19(6) and 245; Karnataka Cinemas (Regulation) Rule, 1971 - Rules 96(5), 96(5A) and 107; Karnataka Cinemas (Regulation)(Amendment) Rule, 1984
AppellantSujatha Touring Talkies and ors.
RespondentState of Karnataka and ors.
Appellant AdvocateB.G. Sridharan, ;G.B. Raikar, ;S.G. Bhat, ;K. Chandrashekar, ;N.Y. Hanumanthappa, ;T.P.S. Kumar, ;N.S. Rajanna, ;Chandrasekhariah, ;B.V. Deshpande, ;R. Gopal, ;P. Ramachandra, ;R. Swaminathan, ;Mohan
Respondent AdvocateM.R. Achar, Govt. Adv.
Excerpt:
- labour & services. dismissal from service: [subhash b. adi, j] dispensation of disciplinary enquiry - electricity (supply) act (54 of 1948) section 79 and karnataka electricity board employees (conduct, discipline, control & appeal) regulations, 1987, regulation 14 petitioner alleged to have been involved in theft - criminal complaint also lodged in this regard - however, based on same evidence criminal court held that charge of theft is not proved and also recovery is not proved by prosecution - disciplinary authority relying upon admission of criminal charge by petitioner before investigation officer and in charge sheet, passing order of dismissal held, not proper, particularly, when enquiry was dispensed with and petitioner had no opportunity before disciplinary authority. further,.....puttaswamy, j. 1. on a reference made by one of us (puttaswamy, j.) these cases have been posted before us for disposal.2. as common questions of law arise for determination in these cases, i propose to dispose of them by a common order.3. all the petitioners hold licences called 'touring cinema licences' issued in their favour by the concerned district magistrates of the districts ('dms') presently under the karnataka cinemas (regulation) act of 1964 (karnataka act 23 of 1964) ('the act') and the karnataka cinemas (regulation) rules, 1971 ('the rules') for exhibiting films at the places detailed in their respective licences. the licences have been re-granted from time to time and were due for re-grant sometime before 3-5-1984 or immediately thereafter as is the case.4. after a series of.....
Judgment:

Puttaswamy, J.

1. On a reference made by one of us (Puttaswamy, J.) these cases have been posted before us for disposal.

2. As common questions of law arise for determination in these cases, I propose to dispose of them by a common order.

3. All the petitioners hold licences called 'Touring Cinema Licences' issued in their favour by the concerned District Magistrates of the Districts ('DMs') presently under the Karnataka Cinemas (Regulation) Act of 1964 (Karnataka Act 23 of 1964) ('the Act') and the Karnataka Cinemas (Regulation) Rules, 1971 ('the Rules') for exhibiting films at the places detailed in their respective licences. The licences have been re-granted from time to time and were due for re-grant sometime before 3-5-1984 or immediately thereafter as is the case.

4. After a series of amendments to the Rules, their periodical and endless challenges before this Court, which so far regretfully ended up only in abortive results, to which aspect I will have occasion to refer to it in some detail at a later stage, Government of Karnataka in exercise of the powers conferred on it by S. 19 of the Act, in Notification No.HD 35 CNL 78 dt. 12-4-1984 published in the Karnataka Gazette dt. 3-5-1984 promulgated the Karnataka Cinemas (Regulation) (Amendment) Rules, 1984 ('1984 Amendment Rules') making certain amendments to Rr. 90, 96 and 107 of the Rules. When the licensing authorities functioning under the Act with no choice left in the matter were enforcing or had sought to enforce the Rules as amended on 12-4-1984, the petitioners as in the past have again approached this Court challenging the validity of S. 19(2)(c) of the Act and Rr. 96(5) and (5A) and 107 of the Rules.

5. As on 1-11-1956, on which day the new State of Mysore now called 'Karnataka' comprising of the areas specified in S. 7 of the States Reorganisation Act '(SR Act') came into being, the Mysore Cinemas (Regulation) Act., 1952; the Madras Cinemas (Regulation) Act, 1955; the Bombay Cinemas (Regulation) Act, 1953; the Hyderabad Cinemas (Regulation) Act, 1952 and Part-III of the Cinematograph Act, 1952 (Central Act 37 of 1952) were in force in the respective integrating areas, which by S. 119 of the SR Act, continued to be in force in the respective areas.

6.The new State by virtue of the powers derived by Art. 246 of the Constitution and Entry 33 of List-11 (State List) of the 7th Sch. to the Constitution enacted the uniform Act. The Act is a consolidating and amending Act. The Act which received the assent of the President on 10-4-1964 came into force on 153-1971 (vide Notification No.HD 50 CNA 62 (S.O. No. 479) dt. 6-3-1971 and S. 1(3) of the Act). Section 23 of the Act repealed the previous enactments that were in force in the corresponding areas of the new State.

7. Before bringing the Act into force Government in exercise of the powers conferred by S. 19 of the Act also framed the Rules. Rule 117 of the Rules repealed all the corresponding Rules in the corresponding areas. The Rules published in the Karnataka Gazette dt. 10-3-1971 came into force from 15-3-1971 on which day the Act also came into force.

8. Part IV Chapter X11 of the Rules while adopting certain Rules dealing with permanent cinemas, made special provisions for 'touring cinemas'. The Rules as originally framed provided for grant of a 'No objection certificate' ('NOC'), a licence for a period not exceeding one year and did not provide for re-grant or renewal of a licence for a touring cinema once issued thereunder. But, the Karnataka Cinemas (Regulation) (First Amendment) Rules, 1974 ('1974 Amendments') framed by Government on 16-4-1974 published in the Karnataka Gazette dt. 25-4-1974 that came into force from that day, making various amendments to the Rules with which we are not concerned, for the first time provided for re-grant of touring cinema licences, stoppage of shows for a period of one month after the expiry of one year and placed certain restrictions on the grant of touring cinema licences. The validity of the 1974 Rules in so far as they amended Rr. 98 and 107 of the Rules or Rr. 11 and 16 of those Rules was challenged before this Court by a number of touring cinema licensees in Writ Petitions Nos. 1654 to 1661 of 1974 and connected cases which were disposed of on 18-10-1974 by Chandrasekhar, J. (as he then was) since reported as Sri Laxmi Touring Talkies v. State of Karnataka (1975) 1 Kant U 419 : AIR 1975 Kant 37. In those cases the Court while striking down cl. (b) of sub-rule (1) of R. 107 of the Rules as beyond the rulemaking power of Government, upheld the validity of R. 98(2) of the Rules however expressing that the said amended Rules did not apply to earlier licensees and their re-grants, the correctness of which was assailed by both sides in Writ Appeal No. 810 of 1974 and connected cases to the extent the same affected them.

9.When those appeals were still pending, Venkataramiah, J. (as he then was) in Anjanappa K. J. v. S. Marappa (1975) 2 Kant LJ 383 noticing the ruling rendered by Chandrasekhar, J. (as he then was) in Laxmi Touring Talkies' case held that a fresh NOC had to be obtained on the expiry of the period of licence. Both these and other decisions rendered by other learned single Judges gave rise to two references to a Full Bench, the first one since reported as T. A Sriramulu Naidu v. Divisional Commissioner, Bangalore Division ILR (1984) 2 Kant 1127 and the second one as State of Karnataka v. Sri Laxmi Touring Talkies ILR (1984) 2 Kant 1192.

10.When the said references before the Full Bench were pending, Rule 96 which had been earlier substituted on 17-1-1973 was amended by Government in its notification No. GSR 189 dt. 1/2-7-1976. The effect of the two amendments; in particular of the later was, that an NOC had to be produced along with an application for re-grant of a touring cinema licence on the expiry of every one year as adumbrated in that Rule and the validity of the same was also challenged by the licensees before this Court.

11.On 1-9-1978 a Full Bench of this Court consisting of Jagannatha Shetty, Venkatachalaiah and Rama Jois, JJ. rendered its opinion in both the references. In Sriramulu Naidu's case (ILR (1984) 2 Kant 1127) the majority consisting of Jagannatha Shetty and Venkatachaliah, JJ. expressed thus :

'The licensing authority while considering an application for re-grant of a licence to a touring cinema, is not required to re-examine whether the site where the touring cinema has been located, satisfies the requirements of the Karnataka Cinemas (Regulation) Rules, 197 1, if the original grant of licence was for a period less than one year and re-grant is sought to be granted up to one year from the date of the original licence. But, if re-grant is sought for a period, beyond one year from the date of the original grant, then the Licensing Authority must examine the question whether the site where the touring cinema has been located satisfies the requirements of the Karnataka Cinemas (Regulation) Rules, 1971. It cannot re-grant licence for the second year without producing a fresh 'NOC'. It cannot also re-grant licence for the third year without a fresh 'NOC' in respect of the site in question'.

In the other, the Full Bench unanimously held that R. 107(l)(b) of the Rules was introverts of the Act. In conformity with the opinion of the Full Bench, the Division Bench on 15-111978 disposed of the writ appeals.

12. After the disposal of the above cases by the Full Bench and Division Bench, all other cases challenging the validity of Rr. 96, 98(2) and 107 of the Rules were heard and disposed of on 20-12-1978 by Rama Jois, J since reported as Murali Touring Talkies V. State of Karnataka, : AIR1979Kant162 . In these cases on the challenge to R. 107(l)(b) of the Rules, the State Government filed a memo undertaking to amend the said Rule and till then not to enforce the same. The memo filed by Government, reads thus :

'The undersigned submits as follows:-

1. The Government undertakes to suitably amend R. 1070)(b) so as to enable grant of licence for Touring Talkies in such places with a population of 15,000 and more where there are no permanent theatres. Pending this amendment, if the District Magistrates have already issued licences to Touring Talkies, then the provision of the present amendment will not be insisted upon the cancelling such licences.

2. As regards R. 96(5), the Government undertakes to amend suitably so as to bring it in conformity with the Full Bench judgment of the High Court of Karnataka in Writ Petition No. 798 of 1975. The Full Bench has directed that 'if re-grant is sought for a period of one year from the date of original grant, then, the licensing authority must examine the 'question whether the site where the touring Cinema has been located satisfy the requirement of the Karnataka Cinemas (Regulation) Rules, 1971'. In effect the Full Bench have emphasized the necessity of obtaining a No Objection Certificate even for the second year. Therefore, R. 96(5) will be so amended as to make compulsory to obtain a fresh NOC not only for third year, but for the second year also. It is necessary to publish or notify the request of any applicant who has applied for obtaining NOC. How this request for NOC is to be published whether through newspapers or any other convenient method will be again examined by the Government at the time of amending R. 96(5).'

In conformity with this memo, the challenge to R. 107(l) was left open, however, rejecting the challenge to the other Rules viz., Rr. 96(5) and 98(2) on merits. Even this order was again assailed by the licensees in a large number of writ appeals before this Court. In those appeals, the Government in continuation of the earlier memo filed before Rama Jois. J. in Murali Touring Talkies' case filed another memo on 30-11-1983 undertaking to amend Rr. 96(5) and 107 of the Rules and not to enforce them till they we I re suitably amended. The said memo filed by Government reads thus :

'Memo filed on behalf of State

In pursuance of the Memo dt. 15-12-1978 filed in Writ Petition No. 11963/78 and connected writ petitions, the State Government has taken steps to amend Rr. 96(5) and 107 of the Karnataka Cinemas (Regulation) Rules, 1971.

In view of the proposed amendment, the State will not enforce the provisions of Rr. 96(5) and 107 of the Karnataka Cinemas (Regulation) Rules, 1971 until the proposed amendment comes into force.'

On the above memo a Division Bench of this Court consisting of Venkatachala and Laxmeshwar, JJ. on 30-11-1983 set aside the orders made by Chandrasekhar, J. (as he then was) and Rama Jois. J. in Laxmi Touring Talkies' (AIR 1975 Kant 37) and Murali Touring Talkies : AIR1979Kant162 cases in so far as they related to the challenge to Rr. 96(5) and 107 of the Rules and dismissed the writ petitions as withdrawn by the petitioners with liberty reserved to challenge those Rules, when amended. On 17-4-1984 a Division Bench of this Court consisting of Venkatachala and Laxmeshwar, JJ. up held the validity of R. 98(2) and the orders made by Chandrasekhar, J. (as he then was) and Rama Jois. J. to that extent. We are not now concerned with the validity of R. 98(2) that is now concluded, so far as this Court is concerned.

13. In conformity with the above undertaking, and otherwise, Government in its Notification No. HD 15 CNL 78 dt. 30-11 -1983 (published in the Karnataka Gazette dt. 82-1983) proposed amendments to Rr. 90, 96 and 107 of the Rules. On 12-4-1984 Government notified the approved Rules and published them in the Gazette dt. 3-5-1984, from which day they have also come into force. The validity of amendment to R. 90 is not challenged and the challenge is now confined to Rr. 96(5) and (5A) and 107 only.

14. First the petitioners have urged that re-grant of their licences are exclusively governed by the requirements of R. 105 of the Rules and, therefore, the DMs cannot insist on them to comply with the requirements of R. 96(5), (5A) and R. 107 of the Rules. Alternatively or independently, the petitioners have urged that the 1984 Amendment Rules had no application to licences issued before their promulgation. Evidently, being aware that these grounds are concluded against them, the petitioners have challenged the validity of S. 19(2)(c) of the Act, Rr. 96(5), (5A) and 107 of the Rules as ultra vires of the Act and as violative of Arts. 14 and 19 of the Constitution. I will refer to them in detail when I notice the contentions bearing on them.

15. In their return, the respondents have justified the impugned provisions and the actions of the authorities under the Rules. An intervenor in Writ Petition No. 8569 of 1984 has also filed his separate return supporting the respondents.

16. Sriyuths B. G. Sridharan, K. Srinivasan, G. B. Raikar, learned Advocates have appeared for the petitioners. I will hereafter refer to the contentions urged by the petitioners as urged by Sri Sridharan, which however should be understood as urged by Sriyuths Srinivasan and Raikar also or vice-versa also.

17. Sri M. R. Achar, learned Government Advocate has appeared for the respondents. Sriyuths H. B. Datar, U.L. Narayana Rao and S. G. Bhat have appeared for the intervenors and they have supported Sri Achar.

18. Both sides have addressed full and exhaustive arguments before us in support of their respective cases occupying more than 10 full working days, relying on every reported and unreported decision on every point elaborated before us. I express my indebtedness to all of them for their thorough and painstaking arguments.

19. Sri Sridharan has urged that re-grant of touring cinema licences was exclusively governed by Rule 105 of the Rules and its requirements only and compliance with the requirements of Rr. 96(5), (5A) and 107 of the Rules did not at all arise.

20. Sri Achar has urged that the question was concluded by the Full Bench ruling of this Court in Sriramulu Naidu's case (ILR (1984) 2 Kant 1127).

21. Rule 105 of the Rules that provides for re-grants, reads thus :

'105. Re-grant of licence :- (1) An application for re-grant of a licence shall be made not less than 15 days before the expiry of the licence originally granted;

Provided that, if the licensing authority is satisfied that for valid reasons the application could not be made within the period specified in sub-rule (1), he may receive an application filed after the said date.

(2) Every application for re-grant of a licence shall be accompanied by a certificate of the Electrical Inspector duly re-granted, a certificate referred to in cl. (d) of sub-rule (1) of R. 97, treasury receipts 'receipts for payment of fees at the rates specified in R. 106 and a copy of the licence originally granted.

(3) On receipt of the application for re-grant of licence, the licensing authority may, after such enquiry as it deems necessary subject to R. 99, re-grant the licence'.

This Court is bound to examine the true scope and ambit of R. 105 and express its views on the same one way or the other if the same had not been examined earlier and was not res integra. But, as I apprehend, the same is no longer res integra. I, therefore, propose to examine the same first.

22. On the true scope and ambit of R. 105, there was sharp difference of opinion which have been noticed by Jagannatha Shetty, J. in his order of reference to the Division Bench in Sriramulu Naidu's case (vide pages 1134 to 1138) and then in the order of reference made by the Division Bench in that very case (pages 1139 to 1142). On an examination of that question, the Full Bench expressed its views, which I have set out earlier in some detail. On the scope and ambit, the majority did not approve the views of Chandrasekhar, J. (as he then was) in Laxmi Touring Talkies' case (AIR 1975 Kant 37) and expressed its views, which are binding on us.

23. But, Sri Sridharan, has urged that the opinion expressed by the Full Bench in Sriramulu Naidu's case (ILR (1984) 2 Kant 1127) was beyond the scope of reference and was contrary to the Rules and, therefore, the same requires re-consideration by a larger Bench.

24. I have noticed this contention out of deference to the learned counsel and their standing at the bar. I have no doubt that this contention has only to be stated to be rejected.

25. On an exhaustive consideration of the question referred to it, and noticing every relevant provision, the majority and the minority have expressed their considered opinions. I will only be presumptuous, if I were to doubt the correctness of that ruling and refer that very question to a larger Bench, which on any principle of law of precedents, cannot be done by me. 1, therefore, reject this contention of Sri Sridharan.

26. Even the other fact of this contention that the requirements of the R. 96(5), (5A) and R. 107 cannot be applied to previous licences is equally untenable. On this question also, the Full Bench ruling in Sriramulu Naidu's case had not approved the view expressed by Chandrasekhar, J. in Laxmi Touring Talkies' case and has rejected this contention. What I have said earlier, equally applies to this contention of the petitioner and for those very reasons, I reject this contention also.

27. At this stage itself, it is pertinent to point out that there are no material amendments to the Rules and, therefore, the law declared by the Full Bench in its two rulings continues to bind us. I may also add t at none of the counsel have urged to the contrary before us,

28. Sri Raikar has urged that S. 19(2)(c)of the Act confers uncontrolled, unguided and uncanalised power on Government to frame Rules regulating distances and the same suffers from the vice of excessive delegation contravening Article 14 of the Constitution.

29. Section 19 of the Act confers power on Government to frame Rules. Section 19(l) confers general power to frame Rules to carry out the purposes of the Act. Section 19(2) particularises some of the specific matters on which Rules can be made by Government. The matters enumerated in S. 19(2) do not enlarge the scope and ambit of S. 19 of the Act, but they only particularise the matters that fall within the purview of the main section of the Act. The power to make Rules can only be exercised for carrying out the purposes of the Act.

30. Section 19(2)(c) that is in challenge reads thus : -

'19. Powers to make Rules -

(1) xx xx xx

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for

xx xx xx

(c) the limitation of the period for which licences in respect of any place may be granted for touring cinemas, and prescribing the distance from a permanent cinema beyond which licences in respect of any place for touring cinemas may be granted;

xx xx xx

This sub-section empowers Government to make Rules on the limitation of the period of licences for touring cinemas and prescribing the distance from a permanent cinema to a touring cinema. In the general provision viz., S. 19(l) and in the particular provision viz., S. 19(2)(c), there is clear guidance for Government to make Rules on the matters specified therein. A cursory or close examination of the provision does not reveal, that Government has been conferred with uncontrolled, unguided and uncanalised power attracting the vice of excessive delegation. Every one of the rulings of the Supreme Court dealing with the principles of excessive delegation do not support this contention of the petitioners. 1, therefore, reject this contention of the petitioners.

31. As on 30-9-1984 there were 505 permanent cinema theatres and 605 touring cinemas in the State out of which 102 permanent cinema theatres were situated in the City of Bangalore and 50 to 60 touring cinemas were situated in the new extensions or peripheral areas of the City, euphemistically called as Bangalore South and North Taluks.

32. The petitioners challenge to Rr. 96(5), (5A) and 107 of the Rules is based on Articles 14 and 19 of the Constitution. The petitioners have urged that touring cinemas have been picked up for a hostile, discriminatory and arbitrary treatment offending Art. 14 of the Constitution. .On Art. 14 the petitioners have urged that the restrictions placed are not conceived in the interests of the general public but are conceived to protect the interests of their rival traders viz., the permanent cinema operators in the State.

33. In their return, the respondents have justified the impugned Rules. The respondents have urged that the Rules regulating touring cinemas, that have their own peculiarities and distinctions, are not violative of Art. 14 of the Constitution While asserting that the Rules have been framed in the interests of the general public and not in the interests of the permanent cinema operators, the respondents have urged that the Rules have placed only reasonable restrictions saved by Art. 19(6) of the Constitution.

34. Sri Sridharan has urged that R. 96(5) (5A) and R. 107 of the Rules are violative of Arts. 14 and 19 of the Constitution and are invalid.

35. Sri Achar has urged that the impugned Rules are not violative of Arts. 14 and 19 of the Constitution and are valid.

36. The true scope and ambit of Art. 14 of the Constitution has been explained by our Supreme Court in a large n umber of cases and it is enough to refer to two of them only. In Shri Ram Krishna Dalmia v. Shri Justice S. R. Tendolkar, : [1959]1SCR279 a Constitution Bench of the Supreme Court speaking through S. R. Das, C.J. reviewing all the earlier cases till then decided, summed up the true scope and ambit of that Article at paras 11 to 13 (pages 547-550), which has been referred to with approval in all the later cases decided by the Court. In re The Special Courts Bill 1978, : [1979]2SCR476 a larger Bench of seven learned Judges again reviewing all the earlier cases speaking through Chandrachud, C.J. summed up the scope and ambit of that Article in these words :

'72. There are numerous cases which deal with different facets of problems arising under Art. 14 and which set out principles applicable to questions which commonly arise under that article. Among those may be mentioned the decisions in Budhan Choudhary v. State of Bihar : 1955CriLJ374 ; Ram Krishna Dalmia v. S. R. Tendolkar, : [1959]1SCR279 ; C. 1. Emden v. State of U.P. : [1960]2SCR592 ; Kangshari Haldar v. State of West Bengal, : [1960]2SCR646 ; Jyoti Pershad v. Administrator for the Union Territory of Delhi, : [1962]2SCR125 and State of Gujarat v. Shri Ambica Mills Ltd., Ahmedabad, : [1974]3SCR760 . But as, observed by Mathew, J. in the last mentioned case,

'it would be an idle parade of familiar learning to review the multitudinous cases in which the constitutional assurance of equality before the law has been applied'.

'We have, therefore, confined our attention to those cases only in which special tribunals or Courts were set up or Special Judges were appointed for trying offences or classes of offences or cases or classes of cases. The survey which we have made of those cases may be sufficient to give a fair idea of the principles which ought to be followed in determining the validity of classification in such cases and the reasonableness of special procedure prescribed for the trial of offenders alleged to constitute a separate or distinct class.

73. As long back as in 1960, it was said by this Court in Kangshari Haidar that the propositions applicable to cases arising under Art. 14 have been repeated so many times during the past few years that they now sound almost platitudinous. What was considered to be platitudinous some 18 years ago has, in the natural course of events, become even more platitudinous today, especially in view of the avalanche of cases which have flooded this Court. Many a learned Judge of this-Court has said that it is not in the formulation of principles under Art. 14 but in their application to concrete cases that difficulties generally arise. But, considering that we are sitting in a larger Bench than some which decided similar cases under Article 14, and in view of the peculiar importance of the questions arising in this reference, though the questions themselves are not without a precedent, we propose, though undoubtedly at the cost of some repetition, to state the propositions which emerge from the judgments of this Court in so far as they are relevant to the decision of the points which arise for our consideration. Those propositions may be stated thus :

1. The first part of Art. 14, which was adopted from the Irish Constitution is a declaration of equality of the civil rights of all persons within the territories of India. It enshrines a basic principle of republicanism. The second part, which is a corollary of the first and is based on the last clause of the first section of the Fourteenth Amendment of the American Constitution, enjoins that equal protection shall be secured to all such persons in the enjoyment of their rights and liberties without discrimination or favouritism. It is a pledge of the protection of equal laws, that is, laws that operate alike on all persons under like circumstances.

2. The State, in the exercise of its governmental power, has of necessity to make laws operating differently on different groups or classes of persons within its territory to attain particular ends in giving effect to its policies, and it must possess for that purpose large powers of distinguishing and classifying persons or things to be subjected to such laws.

3. The constitutional command to the State to afford equal protection of its laws sets a goal not attainable by the invention and application of a precise formula. Therefore, classification need not be constituted by an exact or scientific exclusion or inclusion of persons or things. The Courts should not insist on delusive exactness or apply doctrinaire tests for determining the validity of classification in any given case, Classification is justified if it is not palpably arbitrary.

4. The principle underlying the guarantee of Article 14 is not that the same rules of law should be applicable to all persons within the Indian territory or that the same remedies should be made available to them irrespective of differences of circumstances. It only means that all persons similarly circumstanced shall be treated alike both in privileges conferred and liabilities imposed. Equal laws would have to be applied to all in the same situation, and there should be no discrimination between one person and another if as regards the subject matter of the legislation their position is substantially the same.

5. By the process of classification, the State has the power of determining who should be regarded as a class for purposes of legislation and in relation to a law enacted on a particular subject. This power, no doubt, in some degree is likely to produce some inequality; but if a law deals with the liberties of a number of well-defined classes, it is not open to the charge of denial of equal protection on the ground that it has no application to other persons. Classification thus means segregation in classes which have a systematic relation, usually found in common properties and characteristics. It postulates a rational basis and does not mean herding together of certain persons and classes arbitrarily.

6. The law can make and set apart the classes according to the needs and exigencies of the society and as suggested by experience. It can recognise even degree of evil, but the classification should never be arbitrary, artificial or evasive.

7. The classification must not be arbitrary but must be rational, that is to say, it must not only be based on some qualities or characteristics which are to be found in all the persons grouped together and not in others who are left out but those qualities or characteristics must have a reasonable relation to the object of the legislation. In order to pass the test, two conditions must be fulfilled, namely, (1) that the classification must be founded on an intelligible differentia which distinguishes those that are grouped together from others and (2) that that differentia must have a rational relation to the object sought to be achieved by the Act.

8. The differentia which is the basis of the classification and the object of the Act are distinct things and what is necessary is that there must be nexus between them. In short, while Art. 14 forbids class discrimination by conferring privileges or imposing liabilities upon persons arbitrarily selected out of a large number of other persons similarly situated in relation to the privileges sought to be conferred or the liabilities proposed to be imposed, it does not forbid classification for the purpose of legislation, provided such classification is not arbitrary in the sense above mentioned.

9. If the legislative policy is clear and definite and as an effective method of carrying out that policy a discretion is vested by the statute upon a body of administrators or officers to make selective application of the law to certain classes or groups of persons, the statute itself cannot be condemned as a piece of discriminatory legislation. In such cases, the power given to the executive body would import a duty on it to classify the subject matter of legislation in accordance with the objective indicated in the statute. If the Administrative body proceeds to classify the persons or things on a basis which has no rational relation to the objective of the legislature, its action can be annulled as offending against the equal protection clause. On the other hand, if the statute itself does not disclose a definite policy or objective and it confers authority on another to make selection at its pleasure, the statute would be held on the face of it to be discriminatory, irrespective of the way in which it is applied.

10. Whether a law conferring discretionary powers on an administrative authority is constitutionally valid or not should not be determined on the assumption that such authority will act in an arbitrary manner in exercising the discretion committed to it. Abuse of power given by law does not occur; but the validity of the law cannot be contested because of such an apprehension. Discretionary power is not necessarily a discriminatory power.

11. Classification necessarily implies the making of a distinction or discrimination between persons classified and those who are not members of that class. It is the essence of a classification that upon the class are cast duties and burdens different from those resting upon the general public. Indeed, the very idea of classification is that of inequality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality.

12. Whether an enactment providing for special procedure for the trial of certain offences is or is not discriminatory and violative of Art. 14 must be determined in each case as it arises, for, no general rule applicable to all cases can safely be laid down. A practical assessment of the operation of the law in the particular circumstances is necessary.

13. A rule of procedure laid down by law comes as much within the purview of Art. 14 as any rule of substantive law and it is necessary that all litigants, who are similarly situated, are able to avail themselves of the same procedural rights for relief and for defence with like protection and without discrimination'.

On this statement, with which alone we are concerned, there was no difference of opinion in the different opinions expressed by the other learned Judges in those cases

37. In E. P. Royappa v. State of Tamil Nadu : (1974)ILLJ172SC Bhagwati, J. speaking for himself and Chandrachud, J. (as he then was) and Krishna Iyer, J., for the first time evolved the principle that arbitrariness was the very antithesis of rule of law enshrined in Art. 14 of the Constitution in these words :

'We cannot countenance any attempt to .truncate its all embracing scope and meaning, for to do so would be to violate its activist magnitude. Equality is a dynamic concept with many aspects and dimensions and it cannot be 'cribbed, cabined and confined' within traditional and doctrinaire limits. From a positivistic point of view, equality is antithetic to arbitrariness. In fact equality and arbitrariness are sworn enemies; one belongs to the rule of law in a republic while the other, to the whim and caprice of an absolute monarch. Where an act is arbitrary, it is implicit in it that it is unequal both according to political logic and constitutional law and is, therefore violative of Art. 14.'

In the later cases, notably in Smt. Mancka Gandhi v. Union of India, : [1978]2SCR621 , Ramana Dayaram Shetty v. International Air Port Authority of India : (1979)IILLJ217SC and Ajay Hasia v. Khalid Mujib Sehravardi : (1981)ILLJ103SC the Court has reiterated and elaborated this principle. In Smt. Maneka Gandhi's case Bhagwati, J. observed thus :

'The principle of reasonableness', which legally as well as philosophically, is an essential element of equality or non-arbitrariness pervades Art. 14 like a brooding omnipresence.'

38. The true scope and ambit of Art. 19 of the Constitution and the tests to be applied in judging the validity of restrictions has been explained by the Supreme Court in a large number of cases and it is enough to refer to three of them only.

39. In State of Madras v. V. G. Row, : 1952CriLJ966 one of the earliest cases that has become classical, a Constitution Bench of the Supreme Court speaking through Patanjali Sastri, C.J. expressed thus :

'It is important in this context to bear in mind that the test of reasonableness, wherever prescribed, should be applied to each individual statute impugned, and no abstract standard, or general pattern of reasonableness can be laid down as applicable to all cases. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict. In evaluating such elusive factors and forming their own conception of what is reasonable, in all the circumstances of a given case, it is inevitable that the social philosophy and the scale of values of the judges participating in the decision should play an important part, and the limit to their interference with legislative judgment in such cases can only be dictated by their sense of responsibility and self restraint and the sobering reflection that the constitution is meant not only for people of their way of thinking but for all, and that the majority of the elected representatives of the people have in authorising the imposition of the restrictions, considered them to be reasonable'.

In Narendra Kumar v. Union of India, : [1960]2SCR375 a Constitution Bench of the Supreme Court expressed thus :

'(16.) It is clear that, in these three cases, viz., Chintaman Rao's case, : [1950]1SCR759 , Cooverjee's case, : [1954]1SCR873 and M.B. Cotton Association Limited case, : AIR1954SC634 (supra) the Court considered the real question to be whether the interference with the fundamental right was 'reasonable' or not in the interests of the general public and that if the answer to the question was in the affirmative, the law would be valid and it would be invalid if the test of reasonableness was not passed. Prohibition was in all these cases treated as only a kind of 'restriction'. Any other view would, in our opinion, defeat the intention of the Constitution.

(17.) After Art. 19(l) has conferred on the citizen the several rights set out in its seven sub-clauses, action is at once taken by the Constitution in Cls. (2) to (6) to keep the way of social control free from unreasonable impediment. The raison d'etre of a State being the welfare of the members of the State by suitable legislation and appropriate administration, the whole purpose of the creation of the State would be frustrated if the conferment of these seven rights would result in cessation of legislation in the extensive fields where these seven rights, operate. But, without the saving provisions that would be the exact result of Art. 13 of the Constitution. It was to guard against this position that the Constitution provided in its clauses (2) to (6) that even in the fields of these rights new laws might be made and old laws would operate where this was necessary for general welfare, Laws imposing reasonable restriction on the exercise of the rights are saved by Clause (2) in respect of rights under sub-cl. (a) where the restrictions are 'in the, interests of the security of the State'; and of other matters mentioned therein; by Clause (3) in respect of the rights conferred by sub-clause (b) where the restrictions are 'in the interests of the public order'; by Clauses (4), (5) and (6) in respect of the rights conferred by sub cls. (c), (d), (e), (f) and (g) the restrictions are 'in the interests of the general public' -in Clause (S) which is in respect of rights conferred by sub-cls. (d), (e) and (f) also where the restrictions are 'for the protection of the interests of any Scheduled Tribe'. But, for these saving provisions such laws would have been void because of Art. 13 which is in these words:

'All laws in force in the territory of India immediately before the commencement of this Constitution, in so far as they are inconsistent with the provisions of this Part, shall, to the extent of such inconsistency, be void; (2) The State shall not make any law which takes away or abridges the rights conferred by this part and any law made in contravention of this clause shall, to the extent of the contravention be void...'

18. As it was to remedy the harm that would otherwise be caused by the provisions of Art. 13 that these saving provisions were made, it is proper to remember the words of Art. 13 in interpreting the words 'reasonable restrictions' on the exercise of the right as used in Cl. (2). It is reasonable to think that the makers of the Constitution considered the word 'restriction' to be sufficiently wide to save laws 'inconsistent' with Art. 19(l), or 'taking away the rights' conferred by the Article, provided this inconsistency or taking away was reasonable in the interests of the different matters mentioned in the Clause. There can be no doubt therefore that they intended the word 'restriction' to include cases of 'prohibition' also. The contention that a law prohibiting the exercise of a fundamental right is in no case saved, cannot therefore, be accepted. It is undoubtedly correct, however, that when, as in the present case, the restriction reaches the stage of prohibition special care has to be taken by the Court to see that the test of reasonableness is satisfied. The greater the restriction, the more the need for strict scrutiny by the Court.

19. In applying the test of reasonableness' the Court has to consider the question in the background of the facts and circumstances under which the order was made, taking into account the nature of the evil that was sought to be achieved by such law, the ratio of the harm caused to individual citizens by the proposed remedy, to the beneficial effect reasonably expected to result to the general public. It will also be necessary to consider in that connection whether the restraint caused by the law is more than was necessary in the interests of the general public.'

In Laxmi Khandasari v. State of U.P., : [1981]3SCR92 the Court expressed thus:

'We, therefore, fully agree with the contention advanced by the Petitioners that where there is a clear violation of Art. 19(l)(g), the State has to justify by acceptable evidence, inevitable consequences or sufficient materials that the restriction, whether partial or complete, is in public interest and contains the quality of reasonableness.

xx xx xx

As to what are reasonable restrictions would naturally depend on the nature and circumstances of the case, the character of the statute, the object which it seeks to serve, the existing circumstances, the extent of the evil sought to be remedied as also the nature of restraint or restriction placed on the rights of the citizen. It is difficult to lay down any hard and fast ' rule of universal application but this Court has consistently held that in imposing such restrictions the State must adopt an objective standard amounting to a social control by restricting the rights of the citizens where the necessities of the situation demand.

xx xx xx

Further restrictions may be partial, complete, permanent or temporary, but they must bear a close nexus with the object in the interest of which they are imposed.

xx xx xx

Another important consideration is that the restrictions must be in public interest and are imposed by striking a just balance between the deprivation of right and danger or evil sought to be avoided.'

Bearing these principles it is necessary to examine the challenge based on Arts. 14 and 19 of the Constitution. But, before that, it is advantageous to briefly survey the Act and the Rules.

40. The Act has been enacted to provide for regulating exhibition by means of cinematographs and the licensing of places in which cinematograph films are exhibited in the State of Karnataka and for matters connected therewith.

41. Sections 1 and 2 dealing with the title, commencement and definition of certain terms are not material. Section 3 prescribes the authority that can issue licences under the Act. Section 4 of the Act prohibits a person from exhibiting films except in. accordance with a licence issued for that purpose and the terms and conditions stipulated therein. Section 5 provides for making an application for licence. Section 6 provides for the matters to be taken into consideration for granting or refusing a licence. Section 7 confers power on the licensing authority to limit the number of places that can be licensed in an area. Section 8 restricting the powers of the licensing authority, directs him to satisfy himself with the requirements of the Act and the Rules before granting a licence under the Act. Section 9 declares that a licence granted is personal to the grantee and is not transferable without the permission of the licensing authority. Section 10 provides for appeals against orders made under Ss. 5 and 9 of the Act. Section 11directs the construction of building only after obtaining necessary permission from the licensing authority. Section 12 empowers Government to issue directions to the licensees on the matters specified in that section. Section 13 empowers the licensing authority to issue directions to licensees under the Act. Section 14 empowers Government to issue orders and directions of a general character. Section 15 empowers Government and the licensing authority to suspend exhibition of films in certain cases. Section 16 provides for penalties. Section 17, provides for cancellation or suspension of a licence. Section 18 empowers Government to revise the orders made under the Act. Section 19 confers power on Government to make Rules. Section 20 confers power on Government to exempt the matters specified therein from the operation of the Act in the public interest, Section 21 deals with offences by companies. Section 22 provides for laying of the Rules on the floor of the legislature. Section 23 of the Act repeals the enactments that were then in force in the several integrating areas.

42. Part-I (Chapters I, II and III); Part-II (Chapters IV, V and VI); Part-III (Chaps VII, VIII, IX, X and XI); Part-IVA (Chap. XII-A), Part IVB (Chap. XII-B), Part-V (Chap. XIII) and Part VI (Chap. XIV) of the Rules that deal with preliminary, general provisions, procedure for approval of film; permanent cinemas, approval of location of permanent cinemas, approval of plan of building, approval of building construction and issue of Licence buildings and installations; Electrical Installations; fire fighting, maintenance of premises; re-grant of licence; special provisions in the case of certain cinematograph exhibitions and miscellaneous respectively are not very material for our purpose and their detailed analysis is unnecessary.

43. Part-IV (Chap. XII) of the Rules containing Rr. 88 to 111 dealing with 'Touring Cinemas' which is material for our purpose requires a careful and close examination. Unfortunately as observed by Jagannatha Shetty, J. in Sriramulu Naidu's case (ILR (1984) 2 Kant 1127) (FB) at p. 1149, the Rules in this part are haphazardly arranged. But, still I propose to read them coherently.

44. Rule 88 of the Rules declares that the specific Rules made in Part-IV (Chap. XII) and certain Rules made for permanent cinemas referred to therein shall govern touring cinemas. Rule 89 defines the terms 'building' and 'touring cinema'.

45. Rule 90 deals with the procedure for constructing a touring cinema building or the contents of an application to be made for grant of an NOC to locate a touring cinema on or at any place, the documents and the fee that should accompany such application, one of which is a building plan of the building proposed to be constructed on the proposed site. Rule 90(l) inserted by the 1984 Amendment Rules, requires the applicant to notify the substance of his application on the proposed site or camp site as it is called. Rule 100 deals with the fee to be paid along with an application for an NOC. Rule 96 of the Rules deals with the procedure to be followed in dealing with an application for an NOC. Rule 96(l) requires the DM to notify the substance of the application in the newspapers. Role 96(2) requires the DM to satisfy himself with the requirements of Rr. 90(l) and 96(l) of the Rules before initiating further action on the application made before him. Rule 96(3) directs the DM to refer the application along with the documents to the local authority of the area for its opinion. Rule 96(4) directs the DM to examine the objections received from the members of the public and the opinion of the local authority with due regard to the provisions made in the Rules referred to in that Rule. Rule 96(5) and (5A) the validity of which is challenged provide for the manner and method of grant of NOCs for the second and the following years and their currency. Rule 96(6) deals with the period within which an NOC should be utilised or the building should be constructed. Rule 107, the validity of which is also in challenge prescribes the distances and prohibitions in the grant of touring cinemas with reference to the permanent cinemas and other touring cinemas.

46. On consideration of an application for an NOC, the DM is required to make an order for grant or rejection as the circumstances justify. When the application is rejected, the DM necessarily rejects his approval for the building plan annexed to that application and, therefore the question of construction of the building proposed will not arise. But, when he decides to grant an NOC, he must take care to accord his approval to the building plan annexed to that application, with due regard to every one of the provisions made in the Rules and approve the same with or without modifications. On the grant of an NOC and the approval accorded to the building plan with or without modifications, the construction of a building in accordance with such grant and Rr. 91, 92, 94, 95, 102, 103, 103A 104 108, 109, 110 and III is required to be completed within the period allowed by the Rules. A detailed analysis of the Rules regulating the construction of the buildings is not very necessary for our purpose.

47. When a grantee of an NOC has constructed a building on the camp site, he is then required to make an application under Rule 97 before the DM for issue of a licence,, accompanied by the documents referred to therein. Rule 98(l) confers power on the DM to -grant or refuse an application for licence made before him under R. 97 of the Rules. Rule 100 specifies the period for which a licence can be granted or re-granted. The period of licence to be granted or re-granted subject to R. 98(2) cannot exceed one year. Rule 98(2) provides for stoppage of a touring cinema for a period of one month on the expiry of the period of one year of the licence.

48. Rule 105 deals with the re-grant or renewal of a licence issued earlier. Rule 105 provides for making an application for re-grant, the period within which the same should be made, the accompaniments of that application and the power of the DM to hold an enquiry on such an application. I have earlier noticed the clevage on this Rule and how that controversy is concluded by the Full Bench in Sriramulu Naidu's case.

49. The Act does not classify cinemas into different categories and the same has been done in the Rules. The Rules classify cinemas into (i) permanent cinemas that include drive-in theatres; (ii) semi-permanent; (iii) touring cinemas and (iv) video cinemas. This classification has been made by Government with due regard to the technological differences and developments, their nature and a variety of relevant factors and their validity without a shadow of doubt, satisfies the twin requirements of classification under Art. 14 of the Constitution, has not been challenged by the petitioners.

50. The Act nowhere uses the term NOC but consistently uses the term licence for every kind of cinema. But, the Rules made for grant of licences to permanent, including drive-in cinema, semi permanent and touring cinemas provide for grant of an NOC as a condition precedent to the grant of a licence or as the very first step to make an application for a licence to all of them and their validity also has not been challenged by the petitioners.

51. An NOC which is a creature of the Rules is well conceived and is in the interest of the applicants themselves, who propose to enter cinema business and make investments. Without any doubt, the same is also in the public interest. The power to make those Rules can be traced to Ss. 11 and 19(l) of the Act.

52. The Act being a consolidating and amending Act has made various improvements. But, still the Act is generally patterned on other Acts in the country, one of which is the Madhya Pradesh Cinemas (Regulation) Act, 1952 ('MP Act') that is in force in Madhya Pradesh.

53. In Mohd. Ibrahim Khan v. State of Madhya Pradesh, : [1980]1SCR792 , the Supreme Court was considering the challenge of a licence granted under the M, P. Act to respondent-3 in that case, for a quasi permanent cinema commencing with the grant of an NOC for a temporary or touring cinema to the same person and the right of an objector to challenge the later licence granted under that Act. On an examination of that Act and the Rules made thereunder by that Government, Desai, J. explained an NOC under that Act in these words :

'7. Rule 3 envisages construction of a cinema house and as a first step, selection of a site where the cinema house is to be located. Selection of the site and its clearance by the licensing authority by the issuance of a no objection certificate is an important step to be taken in the direction of finally constructing a cinema house and obtaining a licence for the same. In the facts of this case the application is for a quasi-permanent cinema licence. When any person desires to erect a cinema meaning thereby a place where an exhibition by means of cinematograph is to be given, he must apply for a no-objection, certificate in respect of the site where the cinema house is to be constructed. When such an application is received, it is to be advertised in the manner prescribed inviting the public to file objections. After considering the objections the licensing authority has to decide whether to grant or refuse the no-objection certificate. This scheme emerges from the combined reading of Rr' 3 ' 4.1 5 and 6. Chap. III in the Rules prescribes rules in respect of the building to be used as a cinema house. But, before one proceeds to construct the cinema, obtaining of a no objection certificate relevant to the site on which cinema house is to be constructed is a sine qua non.

X X XX XX

11. The second fallacy is that Rr. 3 to 6 envisage an advertisement of an application for a no-objection certificate and inviting objections thereto and disposal of such an application. There is, however, nothing in the Act or the Rules which requires the licensing authority to invite objections before grant of a quasi permanent cinema licence. The right to object is at the initial stage when a no objection certificate is applied for by the intending applicant for such a certificate. But, there is no provision for inviting objections when the application is for a permanent or quasi permanent cinema licence or a touring cinema licence. There is no provision in the Act or Rules which requires advertisement of such an application inviting objections and consideration of the objections before grant of a cinema licence. In this case the application which was turned down by the District Magistrate was one for renewal of a quasi permanent cinema licence. The application for a no objection certificate and granting of the same had passed muster long before on 10th Feb., 1976 and appellants had not raised any objection to the grant of no objection certificate. When the present appellants objected to the renewal of a quasi permanent cinema licence it was not the stage for grant of a no objection certificate but it was the stage of renewal of quasi permanent licence subject to the stage of granting of a no objection certificate, when there was no statutory obligation on the licensing authority to invite objections nor were the appellants entitled to file objections and nor were they entitled to be heard. A right to notice by reason of any rule of natural justice, which a party may establish, must depend for its existence upon proof of an interest which is bound to be injured by not hearing the party claiming to be entitled to a notice and to be heard before an order is passed. If the duty to give notice and to hear the party is not mandatory, the actual order passed on a matter must be shown to have injuriously affected the interest of the party which was given no notice of the matter (see Cosmosteels Pvt. Ltd. v. Jairarn Das Gupta, : [1978]2SCR422 . There was no statutory or mandatory duty to hear the appellants. Therefore, there is no substance in the grievance that before granting renewal of such licence the State Government in the appeal filed by the third respondent had not heard them and that such a decision was rendered in violation of the principles of natural justice.'

On the first question expressed by Desai, J., Pathak. J. expressing his concurrence preferred to leave open the second question. In my view, this enunciation on an NOC though arising under the. MP Act equally governs an NOC under the Act.

54. In Channagiri Rangappa and Sons v. District Magistrate, Chitradurga, (1971) 1 Mys U 60: (AIR-1971 Mys 244) a Division Bench of this Court consisting of Chandrasekhar, J. (as he then was) and Range Gowda, J. dealing with a case arising under the Mysore Cinemas Regulation Act, 1952 ('1952 Act') and the Rules made under the Act has expressed thus on an NOC:

'The Act does not make mention of 'No-Objection' Certificate. But, in our opinion, a 'No objection' Certificate is, in substance, merely the first stage in the grant of a licence for the construction of a cinema theatre on a particular site or for conversion of existing premises into a cinema theatre. A 'No Objection' Certificate must be regarded as part of a licence. The scheme of the Rules appears to be to determine in two stages, the question whether a licence should be granted to a permanent cinema. At the first stage, namely, the stage of granting or refusing a 'No Objection' Certificate, the situation of the site proposed for a permanent cinema theatre, the suitability of such site and the objections of the public for the location of the theatre, are concerned.'

In my view, this enunciation made under the 1952 Act and Rules, that have been replaced by the Act and the Rules, which% is also consistent with the ruling of the Supreme Court in Mohd. Ibrahim Khan's ease: : [1980]1SCR792 , is still good law and, therefore, governs an NOC under the Act and the Rules.

55. What emerges from the above is that an NOC is an imperative pre-requirement for obtaining a fresh licence for a, permanent cinema including drive-in, semi permanent or touring cinema under the Act.

56. With the above analysis it is useful to notice Rule 96 in its entirety( ascertain the trues cope and ambit of R. 96(5) and (5A) in particular and then examine their validity based on Arts. 14 and 19 of the Constitution in that order.

57. The Rules as originally framed in 1971 did not provide for re-grant or renewal of touring cinema licences under the Act. The 1974 Amendments to the Rules for the first time provide for the re-grant of touring cinema licences, however, without insisting on the production of an NOC along with an application for re-grant. But, the amendments made in 1976 substituted, the earlier sub-rule (5) of that rule by a fresh rule that came into force on 2-7-1976, which reads thus :-7

'5(i) The licensing authority, may on application made to it in this behalf, if satisfied, after inspection or such inquiry as it may consider necessary, that the site continues to conform to the provisions of Cls. (h), (i), (j) and (k) of sub-rule (1) of R. 27 and of Rule 107, dispense with the requirements of sub-rule (1) the notice under sub-rule (1) of Rule 90 and the procedure specified in sub-rule (3) for grant of No Objection Certificate for the second year in respect of a camp site licensed for a touring cinema during the, previous year :

'Provided that no such exemption shall be granted in respect of a camp site which had been licenced for a period of two years excluding the break period specified in sub-, rule (2) of R. 98 immediately preceding the date of the application.

(ii) The licensing authority may on application made to it for grant of a No Objection Certificate to run a touring cinema in any Jatra, mela or other similar occasion for a period of one week before the commencement of such jatra, mela or other similar occasion and for one week after the closure thereof, if satisfied after inspection or such inquiry as it deems fit that the site for which the application has been made conforms to provisions of Clauses (h), (i),and (k) of sub-rule (1) of R. 27 and of R. 107, grant the certificate applied for dispensing with the procedure specified in this rule for the grant of No Objection Certificate.'

The 1984 amendments has substituted this Rule and introduced sub-rule (5A) and R. 96 as amended by all those amendments now reads thus :

'96. Procedure on application - (1) The licensing authority shall on receipt of an application under R. 90, notify at the cost of the applicant, the public of such intention by publication in one English and one Kannada Daily newspaper having largest circulation in the area and also by such methods as it deems fit, inviting objections. Such notice shall ' be in Form-C and the period within which objections shall be sent to the licensing authority shall be ten days from the date of publication of the notice.

(2) Before taking further action on the application for grant or otherwise of the 'No Objection Certificate' the Licensing Authority shall satisfy, itself by personal inspection or otherwise that the requirements of sub-rule (1) of Rule 90 have been complied with by the applicant.

(3) The licensing authority shall after satisfying itself that sub-rule (1) of R, 140 has been complied with forward the application together with plans and other connected records to the local authority concerned for its opinion regarding suitability or otherwise of the site for the location of the cinema. If so desired by the local authority the licensing authority shall depute an officer not below the rank of a Tahsildar for a joint inspection of the site with the concerned officers of the local authority which shall furnish its opinion to the licensing authority within a period of ten days from the date of such reference by the licensing authority.

(4) Upon return of records from the local authority, with its opinion, the licensing authority shall consider the objections, if any, received from the members of the public and the opinion of the local authority and if it decides to grant a 'No Objection Certificate' it may grant such a certificate in Form-D within two weeks after the return of records from the local authority or may refuse to grant the same for reasons to be recorded in writing, In so doing, the licensing authority besides having regard to the objections received from the members of the public and the opinion of the local authority shall take into consideration the provisions of Rule 6 and Cls. (h), (i), (j) and (k) of sub-rule (1) of R. 27 and R. 107.

'(5)(i) The licensing authority may, on application made to it in this behalf, if satisfied, after inspection or such inquiry as it may consider necessary, that the site continues to conform to the provisions of Cls. (h), (i), 0) and (k) of sub-rule (1) of R. 27 and of R. 107, dispense with the requirements of sub-rule (1) the notice under sub-rule (1) of R. 90 and the procedure specified in sub-rule (3) for grant of No Objection Certificate for the second year in respect of a camp site licensed for a touring cinema during the previous year:

Provided that no such exemption shall be granted in respect of a camp site which had been licenced for a period of two years excluding the break period specified in sub-rule (2) of R, 98 immediately preceding the date of the application.

(ii) The licensing authority may on application made to it for grant of a No Objection Certificate to run a touring cinema in any jatra, meta or other similar occasion for a period of one week before the commencement of such jatra, meta or other similar occasion and for one week after the closure thereof, if satisfied after inspection or such inquiry as it deems fit that the site for which the application has been made conforms to provisions of Cls. (h), (i), (j) and (k) of sub-rule (1) of R. 27 and of R. 107, grant the certificate applied for dispensing with the procedure specified in this rule for the grant of No Objection Certificate.

(5A) The maximum period for which a 'No Objection Certificate' may be granted shall not exceed a period of one year. For any subsequent period or periods afresh 'No Objection Certificate' shall be obtained.

(6) On the grant of the 'No Objection Certificate', the applicant shall, within two months from the date of such grant, complete the construction of the building. The licensing authority may on an application made to him in this behalf, if satisfied that the applicant could not, for valid reasons, complete the building within the said period of two months, extend the validity of such certificate by a period not exceeding three months. If the building is not constructed within two months or within the extended period, the licensing authority may cancel the said 'No Objection Certificate'.

The rule primarily deals with the procedure to be followed in dealing with an application for grant of an NOC to a touring cinema and the factors to be taken into consideration in deciding such an application made for the very first time.

58. But, the earlier sub-rule (5) substituted in 1976 and the present rule that closely follows the same, provide for production of an NOC along with an application for re-grant of a touring cinema licence and the procedure to be followed thereto for the second and the subsequent years.

59. Sub-rule 5(l) of R. 96 deals with the grant of an NOC for the 2nd year, On an application made by the licensee the DM on being satisfied after inspection or inquiry whichever procedure he chooses, which necessarily means that it is open to him to choose both the procedures together or any of them to the exclusion of the other, but without following the elaborate procedure of notifying the substance of such application on the camp site and the newspapers and inviting objections thereto, can grant an NOC if that camp site conforms with the requirements of R. 27(l)(h)(i)(j)(k) and (1) and R. 107 of the Rules. For the second year, the procedure prescribed is a simple procedure and dispenses with the elaborate procedure; for which of course, the licensee is required to make an application in that behalf before the DM. Sub-rule (1) has used the permissive term 'may'. But, in the context that term has to be read as 'must' and as a rule, the DM should only follow the simple procedure for the second year of the licence.

60. The proviso to sub-rule (5)(i) imperatively directs the DM not to grant or dispense with the procedure stipulated in sub-rule (5)(i) after two years excluding the break period specified in sub-rule (ii) of R. 98(2) of the Rules. The effect of this proviso is that for the third year excluding the break periods, an application for an NOC which is required to be produced along with the re-grant application for that year, must be treated as a fresh application made for the first time and should be dealt and decided on that basis only. In such a case, the requirements of notifications calling for objections, their consideration and a decision thereon must be complied with.

61. Rule 96(5)(ii) deals with the grant of an NOC for special occasions like Jatras, Melas, religious fairs and gatherings, for which the elaborate procedure is dispensed with and power is conferred on the DM to satisfy himself by an inspection or such inquiry as fie deems fit whether that camp site conforms with the requirements of Rr. 27(l)(h),(i),(j),(k),(I) and 107 of the Rules or not.

62. Sub-rule (5)(A) that declares the currency of an NOC granted under Rule 96 as one year which shall not exceed that period, introduced ex abundanti cautela, makes explicit, what is implicit in the main Rules itself.

63. In judging the validity of the Rules with reference to Article 19 of the Constitution, we must bear in mind that the nature of the trade and business carried on by the petitioner was not dangerous or noxious trade which is opposed to public morals, decency and health. The nature of trade and business carried on by the petitioners viz., exhibition of approved cinematograph films, in their theatres is a trade and business guaranteed under Art. 19(l)(g) of the Constitution. In such a trade and business, the State is competent to make regulatory provisions and also impose reasonable restrictions either partial or complete as held by the majority in Srinand Talkies v. State of Karnataka, ILR (1984) 2 Kant 1231.

64. The word touring derived from the word 'tour' means movement. Touring cinemas or theatres, as the name itself suggests are those that move from place to place or itinerate from place to place or at any rate are not permanently fixed to any one particular place.

65. When the cinema and film exhibition was in its infancy in our country and had not become very popular as it is today, virtually replacing every other type of entertainment, touring cinemas generally used to be exhibited in cloth tents with an improvised cabin for housing the projector and equipment for screening the films on the opposite screen. In those tent theatres, the seating arrangements were perforce temporary. In those days almost as a rule touring cinemas used to pitch their tents during religious fairs and gatherings or jatras, melas and other gatherings attracting large number of people necessitating movements from place to place. But, with the passage of time and development of film industry, the demands of audience for better comforts and conveniences, the operators had to make various improvements and adjustments in a competitive business. In that slow but imperceptible process touring cinema tents virtually disappeared and in their place temporary structures with zinc sheets, asbestos sheets, thatched sheds with bamboos and coconut tree palms have come to stay. In some exceptional and rare cases, some owners have been constructed permanent building which however, cannot be treated as a general pattern of the theatres in the State. Whatever be the nature of the structures, that has replaced the earlier cloth tents, it is incontrovertible, that they are all constructed on the basis of NOCs for touring or temporary cinemas only and not on NOCs for permanent cinemas without complying with all the detailed and rigorous provisions made thereto for them. If this aspect is kept in view, it is clear that touring cinemas which are not permanent or semi permanent cinemas cannot be compared with either of them. Both these types are dissimilarly situated and are not similarly situated. Art. 14 guarantees equality of treatment to equals and not to unequals. If Government with due regard to the peculiarities of touring or temporary cinemas, makes provision for an annual NOC in R. 96(5) and (SA), one can hardly condemn the same as offending Art. 14 of the Constitution.

66. Rule 96(5) and (5A) has been framed with due regard to the nature of the temporary structures and other related matters. In such cases periodical NOCs for the places or inspections unlike in the case of other theatres that are permanent cannot be characterised as arbitrary or unreasonable so as to offend Art. 14 of the Constitution.

67. On any test, it is clear that R. 96(5) and (5A) is not violative of Art. 14 of the Constitution.

68. I will now examine the challenge of the petitioners to R. 96(5) and (5A) of the Rules based on Art. 19(l)(g) of the Constitution.

69. According to the petitioners compliance with the requirements of the Rule causes them serious inconveniences and exposes them to needless litigation at any rate, every third year and stoppage of their shows and the same places an unreasonable restriction on the freedom of trade and business guaranteed to them under Art. 19(l)(g) of the Constitution.

70. Rule 96 provides for the disposal of an application for an NOC with expedition. So far as the second year, the procedure is very simple. But, for the third year also, one cannot say that the procedure is impossible of compliance and a licensee will be compelled to stop his shows as a rule, if necessary precaution is taken to make the application well in advance or well before the expiry of license is taken and the same is dealt by e authority as is expected by the Rule possibility of an abuse in a given case is not a ground to invalidate a rule. On the opportunity afforded to the public for the third year, one cannot take exception to the same, which is undoubtedly protected by Art. 19(6) of the Constitution.

71. So far as touring or temporary licenses and temporary structures, unlike permanent structures, R. 96(5) providing for periodical insistence of an NOC, is in the interest of the general public and is saved by Art. 96(6) of the Constitution.

72. On applying the test expounded by the 'Supreme Court in the cases noticed by me, it is clear that R. 96(5) and (5A) are in the interests of the general public and place only reasonable restrictions saved by Art. 19(6) on the freedom of trade and business guaranteed to the petitioners under Art. 19(l)(g). 1, therefore, reject this challenge of the petitioners.

72A. Let me now turn to the validity of R. 107 of the Rules.

73. The petitioners have urged that the classification of touring cinemas and permanent cinemas for different distances was irrational and had no nexus to the object of legislation and was in any event arbitrary, irrational and unreasonable for which reasons, it offends Article 14 of the Constitution. The petitioners have also urged that the Rule places unreasonable restrictions on their freedom of trade and business guaranteed to them under Art. 19(l)(g) of the Constitution and those restrictions are not conceived in the interest of the general public but are concerned in protecting the interests of permanent cinema theatre owners and, is therefore, liable to be struck down as offending Art. 19 of the Constitution.

74. In their return (vide paras 11 to 14) the respondent while denying the assertion of the petitioners have asserted that the rule has been framed to avoid traffic and fire hazards, prevent unhealthy and ruinous competition to permanent theatres which are all conceived in the interest of the general public only and not for protecting permanent theatre owners at the cost of the touring cinema theatre owners. In brief, the respondent's have urged that the restrictions placed are reasonable restrictions that are saved by Art. 19(6) of the Constitution and, therefore, valid.

75. Rule 107 as amended by the 1984 Rules reads thus :

'107. Restrictions on the grant of touring cinema licence:,

'(1) No licence for a touring cinema shall be granted : -

(a) in respect of a site situated 'within a distance of 1.6 kilometers from a permanent cinema or 800 metres from another touring cinema;

(b) in towns and cities having a population of fifteen thousand or more and within a distance of 1.6 kilometers from the limits of such towns and cities.

Provided that Cl. (b) of this sub-rule shall not be applicable where no permanent cinema is situated in such town or city.

Explanation : - For the purpose of this rule, distance shall be reckoned along the shortest pathway, lane, street or road connecting the two cinemas and generally used by members of the public.

(2) Subject/to sub-rule (1), there shall be no other restrictions to grant licence for touring cinemas

As set out in the very heading, this rule places certain restrictions on the grant of licences to touring cinemas. The restrictions placed in the Rule also apply to NOCs for touring cinemas on every occasions-

76. The first restriction placed by the Rule is that a touring cinema cannot be granted within a distance of 1.6 Kms. or I mile front a permanent cinema or there should be a minimum distance of 1.6 Kms. or one mile between a permanent cinema and a touring cinema, such distance being, computed as defined in the explanation to sub-rule (1) of that rule. In other words, a temporary cinema irrespective of all fact situations cannot be located or licensed within a distance of 1.6 Kms. from a permanent cinema, that is already in existence. The second restriction is that there should be a distance of 800 meters or half a mile from one touring cinema to another touring cinema. The rule prohibits the location of a touring cinema within a distance of 800 metres from another touring cinema, such distance being computed as defined in the explanation to sub-rule (b) of that Rule. The third and the last restriction placed by the rule is that in towns and cities with a population of 15,000/- or more and having one or more permanent cinemas in any part of that city or town irrespective of all and every fact situations, a touring cinema cannot be located or licensed within that city or town and a circumference of 1.6 Kms. from the limits of that city or town. In other words, in cities and towns with a population of 15,000/- or more and with a permanent cinema theatre whatever be its population, necessities and non-existence of any of the hazards, a touring cinema cannot be located or licensed in that city or town and has to be located beyond 1.6 Kms. of that city or town limits only rather than at a place where it is found feasible and necessary in the public interest. The proviso added to sub-rule (b) of R. 1070) exempts the operation of that Rule to cities and towns in which there is not a permanent cinema theatre. But, according to the petitioners., which is not seriously disputed by the respondents, there are no cities and towns in the State with a population of 15,000 and more without a permanent cinema theatre, In the very nature of things, this Court cannot record its finding one way or the other on this aspect of the matter. 1, therefore, leave open the same,

77. In Laxmi Touring Talkies Case (ILR (1984) 2 Kant 1192) the Full Bench of this Court has found that R. 107 was intra vires of the Act, which is binding on us. But, the same as also the reasons, if any on which the same, has been upheld has no relevance to judge its validity on the touch stone of Arts. 14 and 19 of the Constitution. 1, therefore, proceed to examine its validity on that basis.

78. I have earlier noticed the pleadings of the parties or. the validity of R. W7. At out request the learned Government Advocate has made available relevant Government files dealing with the amendment made to R, 107 in 1974 and the later amendments made from time to time to that rule and other Rules. I have carefully examined those files to the extent they relate to R 107. 1 find from suction examination, that the opinion formed by Government reflected in the Rules, is riot based on any technical opinion or data or general or special survey of the tact situation in the State or of any particular place that can safely be taken as a guide for all other places in the State. The opinion formed by Government reflected in the Rule amended from time to time, is not also based on a conscientious evaluation of all the pros and cons and the interests of the general public.

79. On the necessity to avoid traffic congestions, fire hazards by providing reasonable distances from one cinema to another cinema, whether it be a permanent cinema or a touring cinema and a touring cinema contemplated by S. 19(2)(c) of the Act there cannot be two opinions. But, the real question is whether the restrictions and distances imposed by the Rule are reasonable and are conceived in the interests of the general public.

80. From the circumstances prevailing in our country in general and our State in particular, with which only-this Court is concerned, I may not be far wrong in holding that great majority of touring cinemas are constructed with thatched sheds variety and they are more vulnerable to fire than all other types of sheds and buildings for which only a distance of 800 meters or half a mile is stipulated. But, that distance doubles itself when it comes to a permanent cinema building which is less prone to fire hazards than a. touring cinema of a thatched shed. The reason or basis for such doubling of the distance cannot be gathered from the rule, the return filed by the respondents or the materials placed before Court. In my view, this apparent and real contradiction without any basis and rationale is plainly discriminatory and does not pass the twin tests of valid classification and suffers from patent arbitrariness and the same, thus offends Art. 14 of the Constitution,

81. Rule 96(5)(ii) very rightly dispenses with the elaborate procedure for grant of NOCs to touring cinemas during religious fairs and gathering, jatras and melas or similar occasions. But, that beneficial provision somewhat strangely is made subject to R. 107 of the Rules, winch means that in a City or 'Town with a population of 15,(W) or more and a permanent cinema, a touring cinema can only be granted beyond 1.6 Kms. of that city or town limit, irrespective of the population on that city or town, the huge throngings of the people at that gathering, the availability of a suitable place for locating a touring cinema adjacent to or nearer to such gathering, however compels them to go out of the city/town to witness touring cinema situated beyond 1.6 Kms. of that city or town limits only. I cannot conceive of a more arbitrary Kant. 41 rule than this, which offends Arts. 14 and 19 of the Constitution.

82. The restrictions placed ignores the fact situations and demands, if any, for entertainment in the ever growing congested cities and towns themselves in what arc called as new extensions or townships and their necessities under R. 27(2) of the Rules also. Whatever be the necessity of such places and the city or town and the location of a touring cinema, though on fact situations (toes not cause any traffic or fire hazard, then also, the Rule operates almost blindly. After all the needs of a new extension on one side cannot be judged from what is prevailing in another extension or the centre of the city itself like Kempegowda Road of Bangalore city, where for a variety of reasons, there is a concentration of permanent cinema houses, The rule also ignores the attempts by cartels of permanent cinema owners to protect themselves and their business interests only endangering the public interest. From all these points and many which are not necessary to catalogue, it is clear that the Rule is violative of Articles 14 and 19 of the Constitution.

83. The provision made for touring cinemas beyond the circumference of 1.6 Kms. from the city and town limits that, are generally uninhabitated and lack in facilities for locating, them notwithstanding that the same does not cause any hazard and its imperative necessity does not also pass the twin tests of valid classification, reasonableness or want of arbitrariness and the same offends Arts. 14 and 19 of the Constitution'

84. In my considered opinion provisions made in the rule to borrow the language of the Supreme Court in D. S. Nakara v. Union of India, : (1983)ILLJ104SC have been really picked up from a hat and is not based or. a proper evaluation of the necessities to prescribe proper distances with due regard to the object of S, 19(2)(c) of' the Act and the interests of general public and is clearly violative of Arts. 14 and 19 of the Constitution.

85. On the above conclusion, it is not very necessary for me to examine the case of the petitioners to the Rule that the same had been trained only to protect the interests of the permanent cinema owners. But, still I briefly propose to notice the same and still more briefly state my tentative views thereon, which will at least help Government to fully study the problem and find a proper solution to the same.

86. Article 19(6) of the Constitution, authorises the State to create a monopoly in any trade or business in its favour of a Corporation owned or controlled by it and not in favour of another citizen or a class of citizens. But, this does not prevent the State from regulating the trade or business including the evils of unhealthy competition and encourage healthy competition that always proves beneficial to the consumers. Unfortunately to draw that dividing line between the two is very difficult and any attempt to regulate the same is extremely difficult, if not impossible and may as well turn out to be a mirage. I will even assume that Government had framed this rule as claimed by it to eliminate unhealthy competition between permanent cinemas and touring cinemas. But, still it appears to me, there also, Government had gone too far and had not done it on a full and critical evaluation of the problem at all and has picked up the solution from a hat.

87. I have carefully read the dissenting opinion proposed to be delivered by my esteemed colleague Narayana Rai Kudoor, J. on the validity of R. 107 of the Rules. For the very reasons stated earlier, I regret my inability to subscribe to his Lordship's views on this aspect.

88. On the above discussion, I hold that R. 107 which offends Arts. 14 and 19 of the Constitution is liable to be struck down.

89. I am conscious that there is imperative necessity to frame a proper rule to achieve the purpose of the Act in general and S. 19(2)(c) of the Act in particular. But, till such a rule is framed by Government, which necessarily takes some time, the authorities under the Act have undoubtedly the power to regulate fresh grant of NOCs for touring cinemas avoiding traffic and fire hazards with due regard to the fact situations in each case which I. hope and trust will be done by them.

90. What now remains to be considered is only the modality of implementing R. 96(5) with due regard to what has happened so far and the interim orders made in all these cases in which the licensing authorities have been directed to consider their applications for re-grant without reference to that Rule and re-grants also made on that basis.

91. I have earlier noticed that the present challenge is more or less a repetition of the earlier challenges on the same subject which has been pending from 1974 and onwards, in which almost every licensee had the benefit of similar interim orders as made in the present cases and has completed many years of operation also. In these circumstances there arises an imperative necessity to regulate the present and future re-grants of touring cinema licenses in a realistic and legal framework.

92. In my view, the construction placed by me in Writ Petition No. 9586 of 1984 and connected cases on the scope and ambit of R. 98(2), the solutions found therein for what had gone by, reckoning the period of the year excluding the break periods is the one and the only way of working R. 96(5), and (5A) that has been upheld by me.

93.In the circumstances that have developed, this Court has necessarily to hold that re-grants made in pursuance of the interim orders made have to be treated as re-grants made for the second full year of that licence and that fresh re-grants hereafter regulated on that basis and not in any other way. In my view, it would be proper for the licensing authorities to extend this benefit even to those that have not so far approached this Court, without unnecessarily driving them to approach this Court and obtain similar orders as in these cases.

94. Before parting with these cases, I deem it proper to notice that the amendments made by Government from time to time are somewhat on an ad hoc basis and not on a full and thorough evaluation of all interests. I have also found that rules dealing with touring cinemas are arranged haphazardly and not scientifically and logically as that should be. The Videos for which a separate set of rules called 'the Karnataka Exhibition of Films on Television Screen through Video Cassette Recorder (Regulation) Rules, 1984 have been framed are being separately challenged by the video owners in Writ Petition No. 11666 of 1984 and connected cases in which also this Court after hearing Government had granted a partial stay. Without going into their validity, there is every need to integrate them with the Rules and have a fresh look into all the Rules taking counsel from all those that are interested in them and frame a fresh set of Rules or make comprehensive amendments as is found necessary and convenient in the best interests of all and the State. In my view, the phenominal development in the industry and more so in the non-permanent cinemas euphemistically called as 'touring cinemas' that have really ceased to be touring and have come to stay, all call for an in depth study and a fresh approach and solution by Government. I have ventured to state this at least to avoid the endless and ruinous litigation that has so far ensued before this Court and is not likely to end unless every one concerned sit together and find out a positive solution to all those problems. I need hardly say that such a solution can only be found by Government and not by Courts. I do hope and trust that Government will find such a solution with all speed and despatch that is possible in the circumstances.

95. In the light of my above discussions, I make the following orders and directions :

(1) 1 strike down R. 107 of the Karnataka Cinemas (Regulation) Rules, 1971 which necessarily means references to that Rule in all other Rules shall also stand deleted. But, this should not be understood as restricting the power of District Magistrates, till a new Rule is framed by Government, from regulating fresh grant of NOCs for touring cinemas in the State on the distances to be maintained from the proposed touring cinema to an existing permanent and touring cinema with due regard -to fact situations in each case.

(2) 1 dismiss these petitions in so far as they challenge S. 19(2)(c) of the Act, R. 96(5) and (5A) of the Rules. But, notwithstanding this, I direct the licensing authorities under the Act viz., the District Magistrates of the Districts to treat the respective re-grants made by them to the concerned petitioner/s in pursuance of the interim orders made in these cases, as made for the full second year of that petitioner/s subject to R. 98(2) of the Rules and regulate their further re-grants in future in accordance with law and the observations made in this order.

96. Writ petitions are disposed of in the above terms. But, in the circumstances of the cases, I direct the parties to bear their own costs.

Narayana Rai Kudoor, J.

97. The petitioners are holders of the licences for touring cinema exhibitions and they have applied for re-grant of the licence under R. 105 of the Karnataka Cinemas (Regulation) Rules, 1971 as amended from time to time (for short 'the Rules') framed under the Karnataka Cinemas (Regulation) Act, 1964 (for short 'the Act'). They have challenged the validity of Rr. 96(5), 96(5-A) and 107 of the Rules and S. 19(2)(c) of the Act on the ground that they are ultra vires of the Act and violative of Arts. 14 and 19(l)(g) of the Constitution in addition to their contention that re-grant of their licences is exclusively governed by the requirements of Rule 105, to the exclusion of the applicability of Rr. 96(5), 96(5-A) and 107 and that the 1984 Amendment Rules had no application to licences issued before their promulgation.

98. I have had the advantage of reading the order proposed to be made by my learned Brother K. S. Puttaswamy, J. While I agree with the reasons and conclusions of my learned Brother on various questions raised in these petitions, with respect, I am unable to bring myself agree with the reasons and conclusions on the constitutional validity of R. 107. 1, therefore, proceed to record my reasons for the same.

99. The challenge of the petitioners relating to the constitutional validity of R. 107 on the ground that it violates the mandates of Arts. 14 and 19 of the Constitution is based primarily on these grounds :

Rule 107 is highly arbitrary and discriminatory and thus offends Art. 14 of the Constitution. The Act makes it permissible for the exhibitors, not only to exhibit the shows in permanent building but also in nonpermanent building. The right to run a cinema, being a fundamental right, whether a person runs the cinema in a non-permanent building i.e. touring talkies, or in a permanent theatre i.e. permanent cinemas, drive-in-cinemas or semi-permanent cinemas, there is no distinction between the two classes in the matter of carrying on the trade and business of exhibition of cinematograph films and both of them will have to be treated equally in the eye of law, The same is not done in the present case. In the case of permanent cinemas, restriction regarding the number of cinemas in a place on the basis of population is imposed under R. 27(2)(a); but no restriction is imposed with regard to the distance to be maintained by permanent theatre owners, even though such a restriction was found in R. 27(2)(b) which prohibited permanent cinemas being permitted within a distance of 400 metres from each other, the same was omitted by a subsequent amendment. No restriction is imposed on the exhibition of permanent cinemas in any place on the basis of the population as done in the case of touring cinemas. Thus, no equal treatment is given for touring cinemas when compared to permanent cinemas. By the impugned rule, the touring cinemas are practically required to be wound up because no one could visit a touring cinema when it is situated beyond the distance of 1.6 Kms. from the limits of towns and cities, the population of which is 15000 or more and where a permanent cinema is situated. There is no nexus between the rule and the object to be achieved thereby, So the rule is discriminatory and offends Art, 14, Besides, R, 107 is highly unreasonable and amounts to total prohibition, contravening the fundamental right guaranteed to the petitioners under Art 19(l)(g), The location of a touring cinema beyond the distance of 1.6 Kms from the limits of towns or cities having a population of 15000 or above and where there is a permanent cinema. will not be of any use whatsoever to the general public, beside being unsafe to the cinegoers to attend film shows, as normally there will not be any house or human habitation in such places., The exhibitors will not be able, either to entertain or educate the public by exhibiting films in such uninhabitated place or locality and thereby the very purpose of the Act will be defeated. Practically there will not be an3 town or city with population of 15000 or more is without a permanent cinema. So, many touring cinema owners who are now conducting cinema shows in such towns and cities will have to shift beyond 1.6 Kms. from the limits of such towns and cities. The proviso now inserted to CL (b) of sub-rule (1) of R. 107 does not provide any solution. Electricity supply may not be available outside the city and town limits. Roads and street lights will not be provided in such places. Various conditions laid down in the rules for conducting touring cinemas such as providing drinking water facility, urinals etc. cannot be complied with. The State cannot compel any one to construct more permanent cinemas in such towns and cities where there is only one permanent cinema, event if the need of the people of such towns and cities is not adequately met with a single permanent cinema theatre. Majority of the people are poor. The rates in touring cinemas are less than the permanent cinemas. So the poor cannot afford to attend permanent cinemas by paying higher rates. Clause (b) of sub-rule (1) of R. 107 imposes total prohibition for the touring cinemas, to operate in towns or cities with population much more than 15000 where only one permanent cinema theatre is situated. Rule 27(2)(a) prescribes the number of permanent cinemas on the basis of population in any place having a population of ten thousand or more. If number of permanent cinema theatres are less than the prescribed standard in such town or city, there is no reason why touring cinemas should be prevented. Besides, it is not at all possible to run a touring cinema effectively and successfully in a place where there is a permanent cinema, keeping a distance of 1.6 Kms. or a place where there is a touring cinema keeping a distance of 800 metres as stipulated in. R, 107(t)(a). It is not practicable to keep such distance between a permanent cinema and a touring cinema and in between two touring cinemas. Such a restriction is highly unreasonable and based on no rational reason or rhime, The touring cinemas have been picked up for a hostitle, discriminatory and arbitrary treatment by imposing such restrictions stipulated under R. 107 on the grant, or re-grant of licences to them. Besides, the restrictions so placed are arbitrary and unreasonable, not conceived in the interest of general public but conceived primarily to protect the interest of the permanent cinema operators in the State, who are the rivals of the owners of the touring cinemas, in the trade and business of exhibiting cinematograph films. Thus R, 107 is violative of Art. 19.

100. The respondents have justified R. 107 in their return. They have urged that R, 107 merely regulates the exhibition of cinematograph films and licencing of places for such exhibitions in the best interest of the general public, with due regard to the peculiarities and distinctions of the touring cinemas and the permanent cinemas and the area of their service to the general public as contemplated in the Act, and therefore, not violative of Arts. 14 and 19 of the Constitution. It only regulates the grant of licence to touring cinema and does not prohibit the touring cinema operators to carry on their trade and business of exhibiting cinematograph films. The restrictions imposed are reasonable restrictions envisaged in the interest of the general public and not in the interest of permanent cinema operators and so saved by Art. 19(6) of the Constitution.

101. The Advocates appearing on either side, spear-headed, their attack and defence on the constitutional validity of R. 107; the counsel appearing for the petitioners contending vehemently that R. 107 violates Arts. 14 and 19 of the Constitution whereas it was with equal vehemence urged by the Advocates appearing for the respondents and the interveners that it does not.

102. It seems to me apposite to advert first to the relevant provisions of the Act d the Rules to better understand and appreciate the rival contentions.

103. The title of the Act suggests that it is a regulatory Act. The preamble to the Act generally serves as a key to discern the purpose and object of the Act. The dual purpose of the Act envisaged in the preamble, are to provide for regulating exhibition of cinematograph films and the licensing of places in which cinematograph films are exhibited. Sections 1 and 2 deal with the title, commencement and definition of certain terms used in the Act. Section 3 prescribes the authority that can issue the licence under the Act. Section 4 prohibits anyone from exhibiting cinematograph films in any place other than the place licensed under the Act or otherwise than in compliance with the conditions and restrictions imposed by such licence. Sections 5 to 8 prescribe the procedure to be adopted and the matters to be considered in granting licence for exhibition of cinematograph films and the places of such exhibitions. Section 11 provides for construction or reconstruction of building or use of places for exhibition of cinematograph films, only after obtaining permission from the licensing authority. Section 12(l) empowers the State Government to issue directions from time to time to any licensee or licensees generally requiring them to exhibit such film or class of films having scientific or educational value, films dealing with news and current events and such documentary films, indigenous films or other films having special value to the public as may have been approved by the State Government in that behalf from time to time. Sub-see. (2) provides that where any directions have been issued under sub-sec. (1) such directions shall be deemed to be additional conditions and restrictions subject to -which the licence has been granted. Section 13 empowers the licensing authority to issue directions to any licensee or licensees generally from time to time requiring to exhibit in each show slides of public interest as may be supplied by the licensing authority. Section 14 empowers the State Government subject to the provisions of the Act and the Rules to issue orders and directions of a general character as it may consider necessary in respect of matters relating to licences for the exhibition of cinematograph films to the licensing authority which the licensing authority is bound to give effect. Section 15 empowers the State Government and the licensing authority to suspend exhibition of films in certain cases. Section 16 provides for penalties. Section 17 provides for cancellation or suspension of licence by the licensing authority. Section 19 confers power on the Government to make rules. Section 20 confers powers on the State Government to exempt from any of the provisions of the Act or of any Rules in the public interest.

104. Part I - Chapters 1, It and 111; Part 11 - Chapters IV, V and VI; Part III -Chapters VII, VIII, IX, X and XI of the Rules deal with Preliminary, General Provisions, Procedure for Approval of Films, Permanent Cinemas, Approval of plan of buildings, Approval of building construction and issue of licences, Buildings and installations, Electrical installations, Fire-fighting, Maintenance of premises and re-grant of licences. Part IV A Chapter XII-A deals with Drive-in-cinemas, Part IV B --- Chapter XIIB deals with, Semi-permanent cinema buildings; Part V - Chapter XIII provides for special provisions in the case of certain cinematograph exhibitions and Part VI - Chapter X IV deals with Miscellaneous, which are not very material for our purpose and their detailed analysis is unnecessary.

105. Part IV - Chapter XII of the Rules containing Rules 88 to 111 are related to touring cinemas. Rule 88 provides for the application bf rules to touring cinemas. It stipulates that the Rules in Part IV -Chapter XII and such other rules and sub-rules referred in the said rule shall mutatis mutandis apply to touring cinemas. Rule 89 defines building and touring cinema for the purpose of Chapter XII. Rule 90 deals with the procedure to be followed for constructing a touring cinema building. Rules 91 to 95 deal with the conditions and certain other matters relating to the building. Rule 96 provides for the procedure to be followed for grant of No Objection Certificate. Rule 97 deals with the application for licence. Rule 98 deals with grant or refusal of licence. Rule 99 prescribes the duration of the licence. Rule 100 provides for the fee for grant of No Objection Certificate. Rule 105 provides for re-grant of licence and R. 107 prescribes certain restrictions on the grant of a touring cinema licence.

106. A close examination of the provisions of the Act would reveal that the legislatures intended to classify exhibition of cinematograph films either in permanent buildings or temporary buildings, calling the former a permanent cinema and the latter a touring cinema, obviously keeping in view the purpose and object of the Act in regulating exhibition by means of cinematograph and the licensing of places in which cinematograph films are exhibited in the State of Karnataka.

107. 'Place' is defined under S. 2(4) to include a house, building, tent, enclosure and any description of transport, whether by water, land or air. In other words, the word 'place' is defined with reference to the buildings or structures etc., either of permanent nature or temporary nature or mobile nature in order to suit the exhibition of cinematograph films called permanent cinemas or touring cinemas. This idea of classification of cinemas into two broad categories viz., permanent and touring is further projected in more specific expressions in cl. (c) of sub-s.(2) of S. 19 by empowering the State Government to make rules, in particular, to limit the period for which the licence in respect of any place may be granted for touring cinemas and prescribing the distance from a permanent cinema beyond which licence in respect of any place for touring cinemas may be granted under its rule making power to carry out the purposes of the Act.

108. Keeping itself within the bounds of S. 19 and also with due regard to the two broad categories of exhibition of cinematograph films viz., permanent cinemas and touring cinemas indicated in the Act, the State Government further classified the permanent cinemas into, permanent cinemas, drive-in-cinemas and cinemas in semi-permanent buildings with due regard to the difference in the place of exhibitions and consistent with the classification of permanent cinemas envisaged by the legislatures in the Act, without making any such further classification relating to touring cinemas keeping in view the concept of touring cinemas and made different rules, appropriate and relevant to conduct and run the different categories of cinemas in the interest and for the benefit of the general public. Thus, a close examination and analysis of the relevant provisions of the Act and the Rules show that the classification of different categories of cinemas such as permanent cinema, drive-in-cinemas, exhibition of films in semi-permanent buildings and touring cinemas is based, not on account of any technological differences and developments in the matter of exhibition of cinematograph films as such but because of the nature and differences in the place of exhibition of cinematograph films and its mobility and immobility character. Otherwise, there could not be anything to classify the cinemas into various categories referred above because the mode of exhibition of cinematograph films and the technique employed by and large in all these categories be the same. However, what is called video cinemas of recent development in which the exhibition of films are conducted on television screen through video cassette recorders may stand on a different footing. Thus it may not be very correct to say that the Act does not classify cinemas into different categories and the same has been done only in the rules. What the rules have provided, in further classifying the exhibition of films into drive-in-cinemas and semi-permanent cinemas was only to carry out the purposes of the Act by classifying them as such and making different rules appropriate and relevant for their application to the different situations. The classification of cinemas into different categories has been made by the Government with due regard to the difference in the place of exhibition of cinematograph films and the area or the class of general public, they are intended to benefit. Thus there is hardly any doubt that these classifications do stand the test of the twin requirements of classification under Art. 14 of the Constitution. The petitioners also have rightly not challenged the classification of the cinemas into different categories.

109. The validity of the rules framed by the State Government in exercise of the powers conferred under S. 19 has to be tested against the background of 'legislative intent' or 'legislative purpose' in enacting the Act. 'Legislative purpose' is the touchstone of statutory interpretation for most of the legal writers, while they view with disfavour the concept of 'legislative intent'. The legislature has expressed itself by the Act and the Court should try to determine as accurately as possible what the legislature intended to be done. The concept of legislative intent and legislative purpose in their widest sense may overlap. But Reed Dickerson makes a fine distinction between the two, in his book 'The Interpretation and Application of Statutes'. He states :

'Thus, in general legal usage the word 'intent' coincides with the particular immediate purpose that the statute is intended to directly express and immediately accomplish, whereas the word 'purpose' refers primarily to an ulterior purpose that the legislature intends the statute to accomplish or help to accomplish.' (Page 88).

110. In order to determine the 'legislative purpose 'scrutiny must begin with the preamble as the preamble in any Act is an excellent guide for the discovery of or discern the legislative purpose. The preamble of the Act states that the Act was to provide for regulating exhibitions by means of cinematographs and the licensing of places in which cinematograph films are exhibited in the State of Karnataka and for other matters. Section 4 provides that cinematograph exhibitions are to be carried on only in places licensed under the Act and in compliance with any conditions and restrictions imposed by such licence. Section 5 provides for obtaining a licence to give exhibition by means of cinematograph in a place. Section 6 details the matters to be considered by the licensing authority in granting the licence. From these provisions, the legislative purpose is clearly intelligible; that was, to regulate the cinematograph exhibitions at suitable places in different locality or localities having regard to the interest of the public generally and to the benefit of any particular locality or localities. Section 19 confers power to the State Government to make rules to carry out the purposes of the Act.

111. The media of exhibition of cinematograph films is one intended, not only to provide entertainment to the people of the State but also to provide as an effective instrument to educate them and keeping them informed of the day-to-day developments or events that contribute to the progress of the country politically, socially and economically, irrespective of the place where they reside, whether it is in cities and towns or in the distant and undeveloped rural areas. This golden thread of legislative purpose or legislative intent runs through the various provisions of the Act and in particular in Ss. 6 to 8 and 12 to 14.

112. Dealing with the importance and significance of cinematograph exhibitions, Jagannatha Shetty, J. in State of Karnataka v. Sri Laxmi Touring Talkies, ILR (1984) 2 Kant 1192 (FB) in para 12 observed :

'.......Today cinematograph exhibitions constitute mass-media whose importance and significance is not inconsiderable and properly utilised can be a powerful instrument of social reconstruction. Conceptionally, cinema is not a mere source of entertainment, Motion pictures can be a means of educational value. Indeed films of the Films Division of Government are intended to be educative and informative in the social, cultural, economic and political fields.'

113. The next question for consideration will be as to how then to serve the interest of the people of the cities, towns and villages alike by cinematograph exhibition. This question may be approached against the background of the general description of the State of Karnataka. In Sri Laxmi Touring Talkies case Jagannatha Shetty, J. referred to the general description of the State of Karnataka as given in the 'Document of International Bank for Reconstruction and Development, International Development Association' published on 7th Mar. 1973 reads :

'From the statistics given therein at page 3, it is clear that the State of Karnataka has an area of about 1,92,000 kilometres; it has a coastline of about 300 kilometres; population is about 29.3 million (provisional figures of 1971 population census). That represents some 5.5 per cent of the total population of India. About 76 per cent of the population live in rural areas, that is, in 29,500 villages. The remaining 24 per cent live in the State's 245 towns and about one half (12%) remain in the 11 principal centres of over 1,00,000 people. Some 6.7 million persons are engaged in agriculture, representing 65% of the total working population. For administrative purposes, the State is divided into four divisions - 19 districts and 175 taluks (administrative units). The economy of the State is fairly diversified with agriculture contributing some 61 per cent to general national produce (GNP)'.

The above statistics reveal that about 76 per cent of the population live in 29,500 villages and the remaining 24 per cent live in 245 towns and among them about one-half remain in the 11 principal centres of over 1,00,000 people.

114. In order to serve the interest of the public generally and to provide benefit to any particular locality or localities as enjoined by Section 6 of the Act, the rule making authority appears to have further classified the cinemas into four categories as noticed earlier of which the touring cinema constitutes one for carrying out the purpose of the Act. They are obviously intended to serve the interest of the people of the cities, towns and villages. In the very nature of the description of the touring cinemas as provided under R. 89 and other provisions applicable to them, they are primarily meant for touring or moving from place to place, obviously in the rural area to cater the needs of the rural populace with comparatively little investment and requiring to provide less facilities and comforts to the cinegoers. We cannot expect people to go to small towns, villages or tiny hamlets to invest huge money in the construction of permanent cinemas, drive-in-cinemas or as a matter of fact even semi-permanent cinemas to cater the needs of rural populace. In this background the constitutional validity of R. 107 on the touchstone of Arts. 14 and 19 shall have to be considered.

115. Rule 107 which is under challenge reads :

'107. Restrictions on the grant of touring cinema licence. (1.) No licence for a touring cinema shall be granted : -

(a) in respect of a site situated within a distance of 1.6 kilometres from a permanent cinema or 800 metres from another touring cinema;

(b) in towns and cities having a population of fifteen thousand or more and within a distance of 1.6 kilometres from the limits of such towns and cities.

Provided that cl. (b) of this sub-rule shall not be applicable where no permanent cinema is situated in such town or city.

Explanation : For the purpose of this rule, distance shall be reckoned along the shortest pathway, lane, street or road connecting the two cinemas and generally used by members of the public.

(2) Subject to sub-rule (1), there shall be no other restrictions to grant licence for touring cinemas.'

116. Before dealing with the issue raised by the contending parties as to the constitutional validity of the above rule, I deem it necessary to state the origin of R. 107, the challenge made against its validity at various stages and the changes it had under gone till it took the shape in the present form. Rule 107 as originally framed and which had come into force with effect from 15-31971 was as under :

'107. Restriction on the grant of licence :

No licence shall be granted to any touring cinema in any place where there is a permanent cinema theatre.

Provided that licence may be granted to one touring cinema in any place with a population exceeding fifteen thousand and if there is only one permanent cinema theatre in such place.

Explanation : For the purpose of this sub-rule, 'place' means an area within a radius of 3 miles from the site on which the permanent cinema theatre is located.'

Applying the said rule, the licensing authorities refused to grant licence for more than one touring cinema in any place with a population exceeding 15,000 and if there was only one permanent cinema theatre in such place considering the 'place' as an area within a radius of 3 miles from the site on which the permanent cinema theatre was located. Contending that the restriction imposed was highly unreasonable and ultra vires of the Constitution, the touring cinema exhibitors challenged the constitutional validity of the said rule under Arts. 14 and 19(l)(g) of the Constitution. Rule 107 was struck down as unreasonable and unconstitutional as offending Arts. 14 and 19(1)(g) of the Constitution in K. S. Gopala Rao v. State of Mysore (1974) 1 Kant U 365.

117. Subsequently the State Government by the Karnataka Cinemas (Regulation) (I Amendment) Rules, 1974 published in the Karnataka Gazette Dt. 25-4-1974 substituted a new rule in the place of the original R. 107, struck down in Gopal Rao's case (1974) 2 Kant U 365 as follows:

' 107. Restrictions on the grant of Touring Cinema Licenses:

(1) No licence for a Touring Cinema shall be granted :

(a) in respect of a site situated within a distance of 1.6 Kms from a permanent cinema or 800 metres from another touring cinema;

(b) In towns or cities having a. population of twenty-five thousand or more

Explanation : For the purpose of this rule 'Distance' shall be reckoned along the shortest path-way, lane, street or road connecting the two cinemas and generally used by members of the public.

(2) Subject to sub-rule (1), there shall be no other restrictions to grant licences for touring cinemas.'

The touring cinema exhibitors challenged the validity of R. 107 as amended by the 1974 amendment. It came to be disposed of on 1810-1974 in Laxmi Touring Talkies v. State of Karnataka AIR 1975 Kant 37. Cl. (b) of sub-rule (1) of R. 107 was struck down as it was beyond the rule making power of the State Government. The correctness of the decision in Laxmi Touring Talkies case was assailed by both sides in W.A. Nos. 810 to 813 and 877 to 894 of 1974 to the extent it affected them.

118. When these appeals were still pending, certain decisions were rendered by this Court by the learned single Judges bearing upon the matters pending in the appeals which gave rise to two references to the Full Bench. One of the references was whether cl. (b) of sub-rule (1) of R. 107 was ultra vires of the Act. On 1-9-1978 the Full Bench in State of Karnataka v. Sri Laxmi Talkies ILR (1984) 2 Kant 1192 unanimously held that R. 107(l) (b) of the Rule was intra. vires of the Act.

119. Soon after the opinion was rendered by the Full Bench holding that R. 107(l)(b) of the Rules was intra vires of the Act, the State Government brought another amendment to R. 107(l)(b) by the Notification dt. 7-9-1978 published in the Karnataka Gazette Dt. 14-91978 as under:

'Amendment of R. 107 : In sub-rule (1) of R. 107 of the Karnataka Cinemas (Regulation) Rules, 1971, for cl. (b) (excluding the explanation), the following clause shall be substituted namely :

(b) In towns and cities having a population of fifteen thousand or more and within a distance of 1.6 kilometers from the limits of such towns and cities.'

The validity of R. 107 as amended was challenged by the licensees before this Court in W.P. Nos. 11426 and 12008 of 1978. These writ petitions along with some other writ petitions were heard and disposed of by this Court in Murali Touring Talkies v. State of Karnataka : AIR1979Kant162 . In the said decision, Rama Jois, J. upheld the constitutional validity of rule 107(l)(a) both under Arts. 14 and 19(l)(g) of the Constitution. As regards R. 107(l)(b), the State Government filed a memo on 15-12-1978, the relevant portion of which reads :

'The undersigned submits as follows :

(1) The Government undertakes to suitably amend R. 1070)(b) so as to enable grant of licence for Touring Talkies in such places with a population of 15,000 and more where there are no permanent theatres ...............'

On the basis of the undertaking to suitably amend R. 107(l)(b) as indicated in the memo. the constitutional validity of R. 107(l)(b) was not decided as it was unnecessary to pronounce on the validity of the contentions raised by the petitioners respecting the constitutional validity of R. 107(l)(b).

120. The decision in Murali Touring Talkies case : AIR1979Kant162 was again assailed by the licensees in a large number of writ appeals before a Division Bench of this Court. In those appeals. the Government in continuation of the earlier memo filed before the learned single Judge in Murali Touring Talkies case, filed another memo dated 30-11 -1983 undertaking to amend Rr. 96(5) and 107 of the Rules and not to enforce them till they were suitably amended. The said memo reads thus :

'In pursuance of the memo dt. 15-12-1978 filed in W.P. No. 11963/78 and connected writ petitions, the State Government has taken steps to amend Rr. 96(5) and 107 of the Karnataka Cinemas (Regulation) Rules, 1971.

In view of the proposed amendment, the State will not enforce the provisions of Rr. 96(5) and 107 of the Karnataka Cinemas (Regulation) Rules, 1971 until the proposed amendments come into force.'

In view of the above memo, a Division Bench of this Court consisting of Venkatachala and Laxmeshwar, JJ. on 30-11-1983 dismissed the writ petitions out of which the appeals have arisen as having been withdrawn, however without prejudice to the rights of the appellants to question the validity of the amended rules to be made if they so choose.

121. In pursuance of the undertaking given, the State Government in its Notification No. HD CNL 78 dated 30-11-1983 (Published in the Karnataka Gazette Dt. 8-12-1983) proposed amendments to rule 107 along with Rr. 90 and 96 of the Rules. On 12-4-1984 the Government notified the approved rules and published them in the Gazette dt. 3-5-1984 from which day they have come into force. The validity of the amendment to R. 90 is not challenged and the challenge is confined to Rr. 96(5), 96(5A) and 107.

122. Now I shall proceed to analyse and examine R. 107.

The heading of. R. 107 states 'Restrictions on the grant of touring cinema licence'. Sub-rule (1) of R. 107 consists of two clauses, a proviso and an explanation. Clause (a) lays down two conditions that no licence for a touring cinema shall be granted in respect of a site situate within a distance of 1.6 Kms (one mile) from a permanent cinema or 800 metres (half a mile) from another touring cinema. In other words, there should be a minimum distance of 1.6 Kms between a permanent cinema and a touring cinema and a distance of 800 metres from one touring cinema to another touring cinema, the distance being computed as stated in the explanation to sub-rule (1). Cl. (b) of sub-rule (1) is a restriction based upon the population and lays down that in towns and cities having a population of 15, 000 or more, no licence for a touring cinema shall be granted within a distance of 1.6 Kms (one mile) from the limits of such towns and cities, the distance being calculated as stated in the explanation to sub-rule (1) subject to the proviso to cl. (b) which provides that cl. (b) of sub-rule (1) shall not be applicable where no permanent cinema is situated in such town or city.

123. Now I shall proceed to consider whether R. 107 violates Arts. 14 and 19 of the Constitution in the light of the arguments advanced on either side to which a reference has been made earlier.

124. Undoubtedly the Act does not prohibit or prevent but only provides for regulating exhibition of cinematograph films and the licensing of places in which cinematograph films are exhibited in the State of Karnataka. The question therefore is whether R. 107 regulates or prohibits the granting of licences to touring cinemas for exhibiting cinematograph films. The impugned rule undoubtedly imposes restrictions on the grant of touring cinema licences. The element of restriction or restraint is inherent both in regulative measures as well as in prohibitive or preventive measures. The term 'regulate' is defined in the Shorter Oxford English Dictionary, Third Edition, as follows:

'To control, govern or direct by Rule or regulations; to subject to guidance or restrictions; to adapt to circumstances or surroundings'

The term 'prohibit' is defined as:

'To hold back; to forbid; to interdict; to prevent, hinder or debar; to forbid or prevent from doing something.'

In other words, the term 'prohibit' postulates negative command. Thus seeing from the meaning of the expression 'regulate' and prohibit', it is clear that the element of restriction is found in both but it varies only in degree.

125. In Municipal Corporation of the City of Toronto v. Virgo 1896 AC 88 at p. 93 of the Report, Lord Davey observed :

'No doubt the regulation and governance of a trade may involve the imposition of restrictions on its exercise both as to time and to a certain extent as to place where such restrictions are in the opinion of the public authority necessary to prevent a nuisance or for the maintenance of order. But their Lordships think there is marked distinction to be drawn between the prohibition or prevention of a trade and the regulation or governance of it, and indeed a power to regulate and govern seems to imply the continued existence of that which is to be regulated or governed.'

In Indu Bhushan v. Rama Sundari : [1970]1SCR443 , the Supreme Court while considering the scope of the word 'regulation' observed :

'The Dictionary meaning of the word 'regulation' in Shorter Oxford Dictionary is 'the Act of regulating' and the word 'regulate' is given the meaning 'to control, govern, or direct by Rule or Regulation'. This entry, thus, gives the power to Parliament to pass legislation for the purpose of directing or controlling all house accommodation in cantonment areas. Clearly, this power to direct or control will include within it all aspects as to who is to make the constructions under what conditions the constructions can be altered, who is to occupy the accommodation and for how long, on what terms is to be occupied, when and under what circumstances the occupant is to cease to occupy it and the manner in which the accommodation is to be utilised. All these are ingredients of regulation of house accommodation and we see no reason to hold that this word 'regulation' has not been used in this wide sense in this entry.'

It would therefore, seem to me reasonable to deduce that the word 'regulation' is a word of broad import having wide meaning comprehending all facets not only specifically enumerated in the Act but also embrace within its fold the powers incidental to the regulation envisaged in good faith in the interest of the general public. Court has to recognise this power of the Government in public interest.

126. Exhibition of approved cinematograph films carried on by the petitioners who are the owners of touring cinemas is undoubtedly a trade or business guaranteed under Art. 19(l)(g) of the Constitution. In such a trade or business, it is generally competent for the State to make regulatory provisions by imposing in the interest of general public reasonable restrictions on the exercise of the right conferred by clause (g) of sub-Art. (1) of Art. 19 of the Constitution on the owners of the touring cinemas. The decisions bearing upon the scope and ambit of fundamental rights guaranteed under Art. 19 of the Constitution and the test to be applied in judging the validity of the restrictions imposed on the exercise of those fundamental rights are legion. I shall advert to a few.

127. My learned brother Puttaswamy, J in his order has referred and extracted the relevant portions of the judgments of the Supreme Court in State of Madras v. V. G. Rao : 1952CriLJ966 ; Narendra Kumar v. Union of India : [1960]2SCR375 ; and Laxmi Khandasari v. State of U.P. : [1981]3SCR92 . However, in addition I shall refer to two more rulings of the Supreme Court on the subject.

In Manektal Chhotalal v. M. G. Makwana : [1967]3SCR65 the Supreme Court observed in para 46 thus :

'............... The principles to be borne in mind in applying Arts. 14 and 19 of the Constitution are now well-settled. A fundamental right to acquire, hold and dispose of property, can be controlled by the State only by making a law imposing in the interest of the general public, reasonable restrictions on the exercise of the said right. Such restrictions on the exercise of a fundamental right shall not be arbitrary or excessive, or beyond what is required to the interest of the general public. The reasonableness of a restriction shall be tested both from substantive and procedural aspects'.

In Harakchand v. Union of India : [1970]1SCR479 , the Supreme Court has stated in para 16 thus :

'It is necessary to emphasise that the principle which underlies the structure of the rights guaranteed under Art. 19 of the Constitution is the principle of balancing of the need for individual liberty with the need for social control in order that the freedoms guaranteed to the individual subserve the larger public interests. It would follow that the reasonableness of the restrictions imposed under the impugned Act would have to be judged by the magnitude of the evil which it is the purpose of the restraints to curb or eliminate.'

128. Bearing these principles in mind, I shall now examine whether the restrictions placed by the impugned rule are reasonable restrictions in granting the licence to the touring cinemas with due regard to the nature of the business carried on by them and the legislative purpose in regulating the grant of the licence for exhibiting cinematograph films.

Section 19(l) of the Act empowers the State Government to make rules to carry out the purposes of the Act. Sub-sec. (2) enumerates specific matters in respect of which rules may be made without prejudice to the generality of the power conferred upon the State Government under sub-sec. (1). The State Government in exercise of the powers conferred under S. 19 framed the rules, of which Part IV Chap. XII relates to touring cinemas. Rule 107 is in Chap. XII. It places certain restrictions on the grant of touring cinema licence. Two restrictions are embodied in Cl. (a) of sub-rule (1) of R. 107, that, there should be a minimum distance of 1.6 Kms. or one mile between a permanent cinema and a touring cinema and of 800 metres or half a mile from one touring cinema to another touring cinema, such distance being computed as provided in the explanation to sub-rule (1) Another restriction is found in cl. (b). It is to the effect that no touring cinema licence can be granted in towns and cities having a population of 15,000 or more and within a distance of 1.6 Kms from the limits of such towns and cities where a permanent cinema is situated. The restrictions contained in sub-cls. (a) and (b) are mutually exclusive in the sense where sub-rule (b) comes into Play and a touring cinema operator is not entitled to the grant of a licence in a town or city having a population of 15,000 or more and where a permanent cinema is situated, the application of the restriction contained in sub-rule (a) does not arise. They would operate only where a touring cinema operator is eligible for the grant of a licence and the licensing authority, while granting licence should act in obedience to the restriction placed under sub-rule (a) on the grant of licence.

129. Now turning to the restriction imposed in the matter of distance as provided under cl. (a) of sub-rule (1), the petitioners have not contended that the distance of 800 metres prescribed from one touring cinema to another touring cinema is unreasonable. Their challenge is regarding the distance of 1.6 Kms between a permanent cinema and a touring cinema. There cannot be two opinions regarding the necessity to provide reasonable distance from one cinema to another cinema whether it be a permanent cinema and a touring cinema or a touring cinema and a touring cinema. Such distance, in my opinion, is absolutely necessary to avoid not only traffic congestion and fire hazards but also to avoid unhealthy competitions between the operators of the permanent cinemas and the touring cinemas and between the operator of one touring cinema and another touring cinema, not only in the interest of general public but also in the interest of the cinema operators themselves. Such a restriction on the basis of the distance, if it is reasonable, can be sustained under cl. (6) of Art. 19. Art. 19(6) of the Constitution empowers the State to create a monopoly in any trade or business in its own favour or in favour of a Corporation owned or controlled by it and not in favour of another citizen or class of citizens but this does not prevent the State from regulating the trade and business to avoid the evils of unhealthy competition and encourage healthy competition which always prove beneficial to the consumers. It is true that the dividing line between the two is very difficult and any attempt to regulate the same is further extremely difficult if not impossible but if such an attempt is made, it cannot be considered an attempt which will turn out to be a mirage. The reasonableness of the action taken by the State shall have to be tested on the guidelines enunciated by the Supreme Court in V. G. Rao's case : 1952CriLJ966 . If certain distance is not allowed to be kept while granting licence to a touring cinema in relation to the site on which a permanent cinema is being operated certainly the touring cinema operator who has invested practically very little capital and subjected to liberal restrictions and conditions in providing seating accommodation, sanitation, protection against fire accident and traffic hazards, etc. could easily enter into unhealthy competition with a permanent cinema holder who had invested huge capital and who is required to provide better safety measures and facilities to the cine-goers and in such a process, it is not unlikely that the permanent cinema operator in the long run has to wind up his trade and business which would indeed adversely affect the public interest arid the benefits enjoyed by the people of a locality or localities. The reasonableness of a distance of 1.6 Kms or a mile prescribed in cl. (a) of sub-rule (1) of R. IN between a permanent cinema and a touring cinema should be considered not only from the point of view of fire hazard and traffic hazard, but also from the point of view of unhealthy competition in the trade which would ultimately affect the public interest. A distance of 1.6 Kms or I mile, in my opinion, having regard to the fact situation and the purpose of the Act is quite reasonable in the interest of general public and saved by cl . (6) of Art. 19 of the Constitution.

130. I shall next deal with sub-cl. (b) of cl. (1) of S. 107.

131. While adverting earlier to the legislative purpose or legislative intent, I have observed that cinematograph exhibitions constitute a mass media whose importance and significance is not inconsiderable and if properly utilised, it can be a powerful instrument in the dissemination of information and can be an instrument of social reconstruction, besides being a means of educating the people who are poor and living in remote rural parts of the State. Indeed films of the Film Division of the Government of India are intended to be educating and informative in the social, cultural, economic and political fields which it intended to reach, not only the residents of the cities and towns, but also the populace of the villages. It was essentially intended that large mass of rural populace should also have the benefit of this source of information and recreation. Thus, the legislatures in enacting the Act and the State Government in carrying out the purposes of the Act by framing rules classified cinemas into four categories, of which touring cinema constitutes one. In the very nature of the description of touring cinema, it is primarily meant for touring or moving from place to place. To make it conveniently mobile, R. 89 has been framed and it defines building and touring cinema as follows :

'89. Definitions - In this Chapter -

(1) 'building' includes any booth, tent or similar structure;

(2) 'touring cinema' means -

(i) an outfit comprising the cinema apparatus and plant and the accessories taken from place to place in the State of Karnataka for giving cinema exhibitions; or

(ii) an outfit comprising cinema apparatus and plant taken from place to place in the State of Karnataka for conducting shows in any local theatre or hall.'

132. The description of the 'building' and the definition of 'touring cinema' clearly indicate that a proprietor of a touring cinema is not required to make heavy investment or put tip a permanent building. He could exhibit cinematograph films in a tent or like structure. He could conveniently shift the structure and the outfit from one place to another if he cannot attract people at a given place. This was obviously done with a view to serve the rural areas by cinematograph exhibitions.

133. Against this background, if we consider the restriction imposed by sub-cl. (b) of cl. (1) of R. 107 that no licence for a touring cinema shall be granted in towns and cities, having a population of 15,000 or more and within a distance of 1.6 Kms from the limits of such towns and cities, where a permanent cinema is situated, could it be said that the exhibition of touring cinemas is totally prohibited thereby or the business of touring cinema is discouraged'! The appropriate answer seems to me is in the negative. The rule in question does not prohibit touring cinemas from exhibiting cinematograph films but only carves out places or localities for exhibition of touring cinemas, having regard to the element of mobility and the smallness of investments and the benefit intended to be provided for a large mass of rural populace. But for this rule, the touring cinema operators certainly would not move to rural parts and prefer to stay in towns and cities as they now endeavour to do, which would not only result in the negation of the object of the Act but also lead to unhealthy competition in the business, seriously affecting the public interest. If this were to happen, then the people living in the rural areas may not have any chance or opportunity to enjoy the benefit of this mass and powerful media of entertainment and information through exhibition of cinematograph films of entertainment and also other educative films and slides of importance which are conducive to the uplift of the rural mass. That is why touring cinema operators are allowed to run the show in temporary structures such as tent or similar structure and subjected to less onerous restrictions and c6nditions so as to enable them with ease and without much inconvenience to move from place to place and exhibit cinematograph film in the rural parts of the State and not in cities or towns where they may not require to move from place to place as most of the touring cinema operators now do and argue that they could not shift from place to place because they have in the course of the years started constructing touring cinema buildings more in the nature of permanent buildings and in some cases even with sound-proof facilities, though they are not required to do so. Merely because they have changed the method of constructing the building and providing other facilities, more of a permanent nature, they cannot now turn round and say that they are unable to tour or move from place to place even though they have enjoyed all the other facilities of a touring cinema and are free from the rigour of the laws that are applicable to permanent, drive-in and semi-permanent cinemas. In the very nature of things one cannot expect permanent, drive-in and semi-permanent cinemas to go to small towns or hamlets for the purpose of benefitting rural mass. The people, of course are not prevented from constructing permanent, drive-in or semi-permanent cinemas in small towns and villages. But who will venture to invest lakhs and lakhs of rupees in the construction of such cinemas in such places where they cannot expect to earn the return for such huge capital. Such cinemas are naturally clustered in cities or in urban areas. In these circumstances, I am inclined to hold that sub-cl. (b) of cl. 1) of R. 107 is regulatory provision and the restriction contained therein is a reasonable restriction and does not prohibit or prevent the petitioners from carrying on their business of conducting touring cinemas. It therefore clearly falls within the protective umbrella of cl. (6) of Art. 19 of the Constitution.

134. Rule 107 indisputably places restriction and control on the touring cinema owners in conducting their business of exhibition of cinematograph films and they may lead to hardship and inconvenience to them. However, having regard to the scheme of the Act and the object sought to be achieved, such results are inevitable. Article 19(l)(g) confers fundamental right to carry on trade or business. But cl. (6) of Art. 19 empowers the State to impose reasonable restrictions in the interest of general public. Therefore, it is clear that the right of the individual guaranteed under Art. 19(l)(g) is not absolute right, but it must yield to reasonable extent when restrictions are imposed by the State in the public interest. Dealing the regulatory provision which regulates the right guaranteed under sub-cl. (g) of Cl. (1) of Art. 19, the Supreme Court in the case of P. V. Sivarajan v. Union of India AIR 1958 SC 556 at page 559 stated as follows :

'Control and regulation of any trade, though reasonable within the meaning of Art. 19, subArt. (6), may in some cases lead to hardship to some persons carrying on the said trade or business if they are unable to satisfy the requirements of the regulatory rules or provisions validly introduced; but once it is conceded that regulation of the trade and its control are justified in the public interest, it would not be open to a person who fails to satisfy the rules or regulations to invoke his fundamental right under Art. 19(l)(g) and challenge the validity of the regulation or rule in question. In our opinion, therefore, the challenge to the validity of the rules on the ground of Art. 19 must fail.'

On the above discussion and also the reasons stated, the challenge of the petitioners on the validity of R. 107 as violative of Art. 19 fails and therefore I reject the same.

135. This takes me to the next question whether R. 107 offends Art. 14 of the Constitution. The decisions on the true scope and ambit of Art. 14 both of the Supreme Court as well as the various High Courts are innumerable. It is impracticable and also seems to me unnecessary to notice all of them. I shall only refer a few decisions rendered by the Supreme Court.

136. The Supreme Court dealing with the scope and ambit of Art. 14 of the Constitution has summed up, speaking through S. R. Das, C.J. reviewing all the earlier cases rendered till then in M. H. Quareshi v. State of Bihar : [1959]1SCR629 observed thus at para 15 :

'It is now well established that while Art.14 forbids class legislation, it does not forbid reasonable classification for the purposes of legislation and that in order to pass the test of permissible classification two conditions must be fulfilled, namely (i) the classification must be founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group and (ii) such differentia must have a rational relation to the object sought to be achieved by the statute in question. The classification, it has been held, may be founded on different bases, namely geographical or according to objects or occupations or the like and what is necessary is that there must be a nexus between the basis of classification and the object of the Act under consideration. The pronouncements of this court further establish amongst other things, that there is always a presumption in favour of the constitutionality of an enactment and that the burden is upon him who attacks it, to show that there has been a clear violation of the constitutional principles. The Courts, it is accepted, must presume that the Legislature understands and correctly appreciates the needs of its own people, that its laws are directed to problems made manifest by experience and that its discriminations are based on adequate grounds. It must be borne in mind that the legislature is free to recognize degrees of harm an ' d may confine its restrictions to those cases where the need is deemed to be the clearest and finally that in order to sustain the presumption of constitutionality the court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation.'

In Re. Special Courts Bill, 1978, : [1979]2SCR476 , a larger Bench of the Supreme Court again reviewing all the earlier cases on the scope and ambit of Art. 14, speaking through Chandrachud, C.J. summed up the scope and ambit of that Article at pages 508-510, the relevant portions have been extracted by my learned brother Puttaswamy, J. in his order.

In E. P. Royappa v. State of Tamil Nadu : (1974)ILLJ172SC , Bhagwati, J speaking for himself and Chandrachud, J. (as he then was) and Krishna Iyer, J. for the first time developed the principle, that equality enshrined in Art. 14 of the Constitution is antithetic to arbitrariness.

In Maneka Gandhi v. Union of India : [1978]2SCR621 , Bhagwati, J. speaking for himself and Untwalia and Murtaza Fazal Ali, JJ. reiterated and elaborated the principle enunciated by the Supreme Court in E. P. Royappa's case : (1974)ILLJ172SC .

In Ramana v. 1. A. Authority of India : (1979)IILLJ217SC , Bhagwati, J. speaking for the Bench, referring to the earlier decision in E. P. Royappa's case : (1974)ILLJ172SC and Maneka Gandhi's case : [1978]2SCR621 . once again reiterated the scope and ambit of Article 14 in these words :

'It is now well settled as a result of the decisions of this Court in E. P. Royappa v. State of Tamil Nadu : (1974)ILLJ172SC and Maneka Gandhi v. Union of India : [1978]2SCR621 that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment. It requires that State action must be based on some rational and relevant principle which is non-discriminatory: it must not be guided being extraneous or irrelevant consideration because that would be denial of equality. The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non-arbitrariness is projected by Art. 14 ................'

In Ajay Hasia v. Khalid Mujib : (1981)ILLJ103SC , the Supreme Court speaking through Bhagwati, J dealing with the new doctrine evolved in E. P. Royappa's case and other subsequent decisions observed :

'The true scope and ambit of Art. 14 has been the subject matter of numerous decisions and it is not necessary to make any detailed reference to them. It is sufficient to state that the content and reach of Art. 14 must not be confused with the doctrine of classification. Unfortunately in the early stages of the evolution of our constitutional law, Art. 14 came to be identified with the doctrine of classification because the view taken was that that Article forbids discrimination and there would be no discrimination where the classification making the differentia fulfils two conditions, namely (i) that the classification is founded on an intelligible differentia which distinguishes persons or things that are grouped together from others left out of the group and (ii) that that differentia has a rational relation to the object sought to be achieved by the impugned legislative or executive action. It was for the first time in E. P. Royappa v. State of Tamil Nadu : (1974)ILLJ172SC that this court laid bare a new dimension of Art. 14 and pointed out that that Article has highly activist magnitude and it embodies a guarantee against arbitrariness ..................

This vital and dynamic aspect which was till then lying latent and submerged in the few simple but pregnant words of Art. 14 was explored and brought to light in Royappa's case and it was reaffirmed and elaborated by this court in Maneka Gandhi v. Union of India : [1978]2SCR621 . This was again reiterated by this court in International Airport Authority's case : (1979)IILLJ217SC (supra) of the Report. It must therefore now be taken to be well settled that what Art. 14 strikes at is arbitrariness because an action that is arbitrary, must necessarily involve negation of equality. The doctrine of classification which is evolved by the courts is not paraphrase of Art. 14 nor is the objective end of that Article. It is merely a judicial formula for determining whether the legislative or executive action in question is arbitrary and therefore, constituting denial of equality. If the classification is not reasonable and does not satisfy the two conditions referred to above, the impugned legislative or executive action would plainly be arbitrary and the guarantee of equality under Art. 14 would be breached. Wherever therefore there is arbitrariness in State action whether it be of the legislature or of the executive or of an 'authority' under Art. 12, Art. 14 immediately springs into action and strikes down such State action. In fact, the concept of reasonableness and non-arbitrariness pervades the entire const4utional scheme and is a golden thread which runs through the whole of the fabric of the Constitution.'

137. As noticed earlier, the. classification of different categories of cinemas has not been challenged as violative of Art. 14. The argument canvassed in support of the contention that R. 107 breaches the equality clause in Art. 14 was that the restrictions imposed on the grant of licence to the touring cinemas under R. 107 are unreasonable arbitrary and discriminatory that they offend the equality clause adumbrated in Art. 14. I find little substance in these submissions. I have already come to the conclusion while dealing with the question whether rule 107 offends Art. 19, that the restrictions imposed on the grant of licence to the touring cinemas under R. 107 are reasonable restrictions intended in the interest of the general public. Rule 107 does not discriminate among equals. The distance provided between a permanent cinema and a touring cinema under sub-cl. (a) of cl. (1) or the prohibition of granting licence to a touring cinema in towns and cities where the population is 15,000 or more and where a permanent cinema is situated, cannot be said to be a discriminatory measure, as the discrimination if at all is made between permanent cinemas and touring cinemas which are two different classes permissible under Art. 14. No contention was urged regarding the distance between the two touring cinemas stipulated in sub-cl. (a) of cl. (1) being discriminatory, arbitrary or unreasonable. It cannot be said that the provisions made in the rule regarding the distance to borrow the language of the Supreme Court in D. S. Nakara v. Union of India : [1983]1SCR729 have been really picked up from a hat and are not based on the proper evaluation of the necessities to prescribe proper distance with due regard to the object of S. 19(2)(c) of the Act and in the interest of general public. Rule 107 in my opinion does not smack arbitrariness to say that it violates Art. 14 of the Constitution. It is a well designed rule to achieve the purpose of the Act that touring cinemas should move from place to place and serve the large mass of rural public without being allowed to concentrate in towns and cities where the remaining three classes of cinemas serve the needs of the people, in the interest of the general public. Hence, I negative the contentions urged for the petitioners that R. 107 is violative of Art. 14 of the Constitution.

138. In the light of my above discussion, I make the following orders and directions :

I dismiss these writ petitions in so far as they challenge the validity of S. 19(2)(c) of the Act, Rr. 96(5), (5-A) and 107 of the Rules. But, notwithstanding this, I direct the licensing authorities under the Act, viz., the District Magistrates of the Districts to treat the respective re-grants made by them to the concerned petitioner/s in pursuance of the interim orders made in these cases, as made for the full second year of that petitioner/s subject to R. 98(2) of the Rules and regulate their further re-grants in future in accordance with law and the observations made in this order.

139. Writ petitions are disposed of in the above terms. But, in the circumstances of the cases, I direct the parties to bear their own costs.

ORDER OF THE COURT

140. In these petitions filed under Art. 226 of the Constitution, the petitioners who are touring cinema licensees and whose applications for re-grants had to be considered under the Act and the Rules, on the facts and circumstances set out in the opinion of one of us (Puttaswamy, J.), the following questions of law have arisen for determination :

(1) What, is the true scope and ambit of R. 105 of the Rules?

(2) Whether S. 19(2)(c) of the Act suffers from the vice of excessive delegation and violates Article 14 of the Constitution?

(3) Whether Rr. 96(5) and (5A) of the Rules are intra vires or ultra vires of the Act?

(4) Whether Rr. 96(5) and (5A) of the Rules are violative of Arts. 14 and 19 of the Constitution?

(5) If Rules 96(5) and (5A) are held to be valid, then how and in what manner applications for re-grants of touring cinema licenses that expired before 12-5-1984 or thereafter should be regulated by the licensing authorities under the Act.

(6)Whether R. 107 of the Rules is intra vires or ultra vires of the Act?

(7) Whether R.. 107 is violative of Arts. 14 and 19 of the Constitution?

(8) If R. 107 of the Rules is declared as invalid then how and in what manner applications for grant of NOCs under the Act and the Rules have to be regulated by the Authorities till such time, Government frames a new Rule to regulate the distances between touring cinemas and permanent cinemas and between the touring cinemas and touring, cinemas.

141. In our separate opinions, pronounced today we have concurred on points I to 6 and disagreed only on point No. 7, one of us (Puttaswamy, J.) expressing that R. 107 was, violative of Arts. 14 and 19 of the Constitution and was liable to be struck down (vide paras 72 to 84) and the other of us (Kudoor. J.) expressing that the said Rule was not violative of Arts. 14 and 19 of the Constitution. Our answer to point No. 8 depends on our answer to point No. 7, which is incidental to the same. Hence, on the view expressed by him, on point No. 7, Kudoor, J. has not expressed his views on point No. 8. In these circumstances it is necessary to refer these cases only on points Nos. 7 and 8 to the opinion of another Hon'ble Judge. We, therefore, in conformity with S. 98(2) of the Code of Civil Procedure and the ruling of the Supreme Court in 1). P. Sharma v. State of Karnataka (S. L. P. Nos. 9417 to 9421 of 1983) refer these cases for the opinion of another Hon'ble Judge of this Court in the first instance on points Nos. 7 and 8 or the following questions of law only :

(1) Whether R. 107 is violative of Arts. 14 and 19 of the Constitution'!

(2) If R. 107 of the Rules is declared as invalid then how and in what manner applications for grant of NOCs under the Act and the Rules have to be regulated by the authorities till such time Government frames a new Rule to regulate the distances between touring cinemas and permanent cinemas and between touring cinemas and touring cinemas.

142. We direct the Registrar to place the papers before the Hon'ble Chief Justice for posting these cases before another Hon'ble Judge of this Court for furnishing his opinion on the above questions of law.

Rania Jois, J.

143. One of the Questions of Law which arose for consideration in this batch of writ petitions presented by the owners of Cinemas exhibited in temporary structures but called 'Touring Cinemas' in which they challenged the Constitutional validity of the Karnataka Cinemas (Regulation) Act, 1964 (the Act for short) and the Karnataka Cinemas (Regulation) Rules, 1971 (the Rules for short) framed under S. 19 of the Act was :

'Whether R. 107 of the Rules is violative of Arts. 14 and 19 of the Constitution?

144. The petitions were heard by a Division Bench of this Court consisting of Puttaswamy, J. and Kudoor, J. In view of the divergence of opinion expressed on the above question in their two separate orders, the above question was referred for ascertaining the opinion of another Judge. The matter has come up before me for my opinion.

145. I have had the benefit of the two learned. though divergent, opinions and also learned arguments addressed by the learned Counsel for the petitioners, for respondent State and intervening Permanent Cinema Owners, who supported the validity of the Rule. All the relevant facts as also reasons in support of each of the views have been set out in the two orders. Therefore, I shall make only a very brief reference to the history of the rule and indicate my reasons to agree or disagree with the views expressed in the two orders.

146. Rule 107 had been framed with the object of regulating the location of touring cinemas. The rule had to undergo successive amendments during the last ten years, as it had been the subject matter of attack before this Court, and the amendments became necessary, in the light of the judgments of this Court.

(i) The validity of R. 107 was challenged for the first time before this Court in K. S. Gopala Rao v. State of Mysore (1974) 1 Kant U 365. The rule as it stood then read :

'Restriction on the grant of licence.- No licence shall be granted to any touring cinema in any place where there is a permanent cinema theatre :

Provided that licence may be granted to one touring cinema in any place with a population exceeding fifteen thousand and if there is only one permanent cinema theatre in such place.

Explanation : For the purpose of this sub-rule 'place' means an area within a radius of three miles from the site on which the ,permanent cinema theatre is located.'

The rule was struck down by this Court as violative of Arts. 14 and 19(1)(g) of the Constitution.

(ii) Thereafter the rule was amended. The validity of the amended rule was challenged in Laxmi Touring Talkies v. State AIR 1975 Kant 37. The rule as amended read :

'107. Restrictions on the grant of touring cinema licences : - (1) No licence for a touring cinema shall be granted : -

(a) in respect of a site situated within a distance of 1.6 kilometers from a permanent cinema or 800 meters from another touring cinema;

(b) in towns or cities having a population of twenty five thousand or more.

Explanation :- For the purposes of this rule, 'distance' shall be reckoned along the shortest pathway, lane, street or road connecting the two cinemas and generally used by members of the public.

(2) Subject to sub-rule (1), there shall be no other restrictions to grant licences for touring cinemas.'

In the said judgment, learned single Judge declared cl. (b) of R. 107, was ultra vires the power of the Government under S. 19. The contention that the rule was violative of Arts. 14 and 19 was not considered as the enforcement of the right conferred by the two articles had been suspended by a notification issued by the President under Art. 359 of the Constitution.

The above judgment was taken in appeal before a Division Bench. The Division Bench referred the question as to whether R. 107(l)(b) was ultra vires S. 19 of the Act, to a Full Bench. The Full Bench held that the rule was intra vires the rule making power conferred on the State Government under S. 19 of the Act. The decision is, State of Karnataka v. Laxmi Touring Talkies ILR (1984) 2 Kant 1192.

(iii) Again R. 107 was amended. The rule as amended read :

'107. Restrictions on the grant of touring cinema licence - (1) No licence for a touring cinema shall be granted : -

(a) in respect of a site situated within a distance of 1.6 kilometers from a permanent cinema or 800 metres from another touring cinema;

(b) in towns and cities having a population of fifteen thousand or more and within a distance of 1.6 kilometers from the limits of such towns and cities.

Explanation - For the purpose of this rule, distance shall be reckoned along the shortest pathway, lane, street or road connecting the two cinemas and generally used by members of the public.

(2 ) Subject to sub-rule (1), there shall be no other restrictions to grant licence for touring cinemas'.

Validity of both the clauses of the rule was challenged in Murali Touring Talkies v. State : AIR1979Kant162 on the ground that they were violative of Arts. 14 and 19. In that case this Court upheld the validity of Cl. (a) of R. 107 (see paragraph 16 of the judgment). As regards cl. (b), a memo was filed on behalf of the Government, undertaking to effect suitable amendment to cl. (b) and that till then that clause would not be enforced (see para 18 of the judgment).

(iv) Thereafter cl. (b) of R. 107 was amended. R. 107 as amended reads:

'107. Restrictions on the grant of touring cinema licence - (1) No licence for a touring cinema shall be granted : -

(a ) in respect of a site situated within a distance of 1.6 kilometers from a permanent cinema or 800 meters from another touring cinema;

(b) in towns and cities having a population of fifteen thousand or more and within a distance of 1.6 kilometers from the limits of such towns and cities.

Explanation - For the purpose of this rule, distance shall be reckoned along the shortest pathway, lane, street or road connecting the two cinemas and generally used by members of the public.

Provided that cl. (b) of this sub-rule shall not be applicable where no permanent cinema is situated in such towns or city'.

The validity of both these clauses were challenged in these writ petitions. They were referred to the Division Bench. Puttaswamy, J. has held that both the clauses are void as offending Arts. 14 and 19 (1)(g) of the Constitution, whereas Kudoor, J. has upheld the validity of both the clauses.

147. I shall first consider the validity of cl. (a) of R. 107. That clause prescribes that no licence shall be granted to a touring cinema in respect of a site situated within a distance of 1.6 kilometers from a permanent cinema or 800 meters from another touring cinema. This regulatory measure, according to the State, has been incorporated in public interest to wit - to avoid traffic congestion, to ensure against unfair competition with permanent cinema houses who would have made heavy investments to provide better comforts, and amenities to cine-goers, and as a precaution against fire accidents, particularly for the reason touring cinemas are temporary structures constructed using materials which are more prone to fire accidents. The contention of the petitioners, however, was that the rule was violative of Art. 14 as no such distance is prescribed between one permanent theatre and another permanent theatre, This contention is untenable. S. 19(2)(c) of the Act reads :

'19. Powers to make rules - (1) The State Government may by notification, after previous publication, make rules to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for--

xxx xxx

(c) the limitation of the period for which licences in respect of any place may be granted for touring cinemas, and prescribing the distance from a permanent cinema beyond which licences in respect of any place for touring cinemas may be granted.'

As can be seen from the above provision, it expressly authorises the Government to fix the distance, only between a touring cinema, I and another tournig cinema or permanent cinema. There is no clause in Sec. 19 which requires the Government to fix the distance between one permanent cinema and another permanent cinema.

The contention of' the petitioners that S, 19(2)(c) itself wits violative of Arts. 14 and 19 has been rejected by both the learned Judges. Therefore, petitioners cannot contend that fixation of distance between a touring cinema and another cinema, is violative of Article 14. Hence, I reject this contention.

148.The only scope for challenging the validity of a rule framed under S. 19(2)(c) is that the distance fixed is unreasonable and arbitrary, if it is so, and on that ground contend that it is violative of Art. 19(1)(g).

The petitioners did contend that the distance fixed in the rule was unreasonable and arbitrary. The validity of a similar rule fixing similar distance between the location of permanent and touring cinema was considered by the Madras High Court in W. A. 49/1968. A copy of the judgment was produced by the learned Government Advocate. The Division Bench said that the rule was in public interest and the restrictions were reasonable and therefore valid.

The object and purpose of the impugned rule set out in the statement of objections referred to earlier, is the same. The file which leads to the framing of the rule hits also been produced. It is seen that a draft rule was framed and was published inviting objections and suggestions to the draft rule. Representations were made by the various interests, and after considering the objections and suggestions, the rule was framed. I am unable to agree with the plea of the petitioners that the distance fixed is unreasonable or arbitrary.

149. For the above reasons, I respectfully agree with the view expressed by Kudoor. J. that R. 1070)(a) is not violative of Art. 14 or 19 (1)(g) of the Constitution and respectfully I disagree with the view expressed by Puttaswamy, J. to the contrary.

150. Now coming to cl. (b) of R. 107, it may be seen that the clause imposes a total prohibition on the grant of licences to touring cinemas, within the limits of a town or city having a population of 15,000 or more, and within a distance of 1.6 kilometers fro the periphery of the town or city, if there exists a permanent cinema. The petitioners have stated oil oath that there is no town or city in the State whose population is 15,000 or more in which there is no permanent theatre; this fact is not controverted by the State and therefore the consequence of R. 107(b) is that, even if having regard to the population of a town or city, there is need for locating more cinema houses in such town or city no licence can be granted to a touring cinema. On this basis, the petitioners contended that the rule imposes unreasonable restriction on the fundamental right of the petitioners to do business, guaranteed under Art. 19(l)(g). In support of this submission, learned Counsel relied on R. 27(2)(a)(i) and (ii) of the Rules. It reads :

'(2) (a) In places having a population of ten thousand or more the number of cinemas to be permitted shall be determined :

(i) if it is a metropolitan area on the basis of one cinema for every twenty thousand population or a fraction thereof exceeding ten thousand; and

(ii) in other places, on the basis of one cinema for every ten thousand population or a fraction thereof exceeding five thousand.'

Learned Counsel pointed out that according to the above rule in a city having a population of 90.000, nine cinema houses could be licensed which means as many as nine cinemas are necessary to cater to the needs of the people. Even though such a need is statutorily recognised, by making R. 27(2) inapplicable to touring cinema under R. 88, and by framing cl. (b) of R. 107, licensing of touring cinemas are prohibited in such a town even if there is only one permanent theatre and that was the position in respect of all towns whose population was more than 15,000.

151. Counsel for the State and for permanent theatre owners, who are interveners, however submitted that when a Full Bench of this Court has held that preexisting R. 107(b) which prohibited the location of touring cinemas in towns and cities having a population of 25000 or more was intra vires S. 19 of the Act, it was not open for the Division Bench or a single Judge to whom the question is referred for his opinion, to hold that the rule was violative of Arts. 14 and 19 of the Constitution.

152. This submission of the learned Counsel is untenable for two reasons. Firstly, the question of constitutional validity of a rule is different from the question whether it is ultra vires or intra vires the provision of the Act under which it is made. The view that a rule is intra vires the provisions of an Act under which it is framed is not conclusive of its constitutional validity. As pointed out earlier, in that case the contention that the rule was violative of Arts. 14 and 19 was not pressed or considered as the enforcement of those articles had been suspended when the writ petition out of which the appeal arose was heard. Secondly, there is wide difference between R. 107(b) which was considered by the Division Bench and the present R. 107(b) in that, the old R. 107(b) prohibited the grant of licence to a touring cinema in a town or city, if its population was 25,000 or more, whereas the impugned R. 107(b) prohibits the grant of licence not only within the town or city having only a population of 15,000 or more, but also within a distance of 1.6 kilometers from the limits of such town or city. Therefore, I am unable to agree that the Full Bench decision concludes the matter and therefore there is no alternative than to uphold the validity of the rule.

153. Though touring cinemas and permanent cinemas differ, in the, matter of building or structure in which films are exhibited and in the matter of amenities and comforts and investment, in the matter of providing entertainment and/or enlightenment to the cine-goers, they are similar as this depends upon the Films exhibited. That being the position, there is no reasonable answer to the question as to why, even if only one permanent theatre is established in towns or cities having more than 15,000 population, no touring cinema should be given license, till sufficient number of permanent cinemas are established and it should be driven out of the city/town to a place 1.6 kilometers away from the town limits. Forcing the location of a touring cinema 1.6 kilometers away from the periphery of a town or city which having regard to its Population, is in need of more cinema houses is in my view an unreasonable restriction on the fundamental right of the owners of touring cinema to do their business, and far from being in the interest of the public. causes great inconvenience, to the cine-goers, as they would have to go 1.6 kilometers away from the periphery of the town to see a film and if it were to be a first or second show they would have to return during night. through roads, where there would be no street- lighting and in most cases they would have to walk the distance, as it is matter of common knowledge that in most of the towns there is no public conveyance system provided, for intra town passengers. Therefore, R. 107(b) is not only discriminatory against touring cinema owners but also arbitrary. Further, it also amounts to an unreasonable restriction on the fundamental right of the petitioners guaranteed under Art. 19(l)(g) of the Constitution.

154. For these reasons, I respectfully agree with the view expressed by Puttaswamy, J that cl. (b) of R. 107 is violative of Articles 14 and 19 of the Constitution and respectfully disagree with the view to the contrary expressed by Kudoor, J.

155. Counsel for the State and for perman4t theatres submitted that prohibiting the grant of licence to touring cinemas at least in cities having heavy population where permanent theatres could earn profits commensurate to the heavy investment made, would be in public interest, as permanent theatres provide better amenities and comforts to the cine-goers, and as the provision for licensing touring cinemas in such cities, would only encourage the establishment of touring cinemas as it involves much lesser investment. There is considerable force in this submission. It might be open for the State, after collecting necessary data, to frame an appropriate rule, specifying metropolitan and other cities, in which no licence for a touring cinema could be granted, if the facts and figures justify the framing of such a rule. In fact, in the file, I found that on the recommendation of the Director of Town Planning arid on consideration of the representations made by the interests, the Deputy Secretary, Home Department, had suggested that R. 107 should be amended to read :

'107. No licence for a touring cinema shall be granted --

(a) in respect of a site situated within a distance of 1 KM from a permanent cinema or 400 Meters from another touring cinema;

(b) in towns and cities having a population of 25000 and above if there are already permanent cinemas there on the scale prescribed under R. 27(2) of these rules for the licensing of permanent cinemas at any place;

(c) notwithstanding anything contained in (b) above, touring cinemas shall not be permitted (i) in any District Headquarter town and (ii) other towns with a population of one lakh and above even if the number of permanent cinemas in such places are less than the number permissible to be licenced under R. 27(2).'

Probably if the rule had been framed in the above form, it would have satisfied both touring cinema and permanent cinema owners or in the event of challenge, the State would have been in a better position to defend its validity. But, for reasons, not very clear, the impugned rule was framed, and for the reasons set out earlier cl. (b) of R. 107, does not stand the test of validity with reference to the right guaranteed to the petitioners under Arts. 14 and 19. The rule is discriminatory because, touring cinema owners stand discriminated though, in terms of theatre-population ratio provided in R. 27, a cinema is necessary to cater to the needs of a town or city, no licence can be issued to a touring cinema in view of R. 107(b). For the same reason the restriction imposed by the rule is also not reasonable and therefore violative of Art. 19(l)(g) and not saved by cl. (6) of Art. 19.

156. In the result, I hold, cl. (a) of R. 107 is not violative of Arts. 14 and 19 and therefore valid and that cl. (b) of R. 107 is void as offending Arts. 14 and 19(l)(g) of the Constitution.

157. There is a second question referred for the opinion of another Judge. It reads :

'If R. 107 of the Rules is declared as invalid then how and in what manner applications for grant of NOCs under the Act and the Rules have to be regulated by the authorities till such time Government frames a new rule to regulate the distances between touring cinemas and permanent cinemas and between touring cinemas and touring cinemas?'

My answer to the question is if R. 107(b) is declared invalid, till a new rule is framed the authorities have no alternative than to proceed to consider the application for grant of licence to a touring cinema on the basis that the rule does not exist. However, the authorities may take the theatre-population ratio prescribed in R. 27(2), as a relevant criterion, to decide as to whether a licence to a touring cinema should be granted or not in a town or city.

Post these petitions before the Division Bench, for hearing, for passing final order of the Court on the point in accordance with the proviso to S. 98(2) of the C. P. C.

FINAL ORDER OF DIVISION BENCH D/- 28-6-1985.

Puttaswamy, J.

158. All the petitioners except the petitioners in Writ Petitions 8943 to 8947 of 1984 are holders of touring cinema licences issued by the District Magistrate of the District under the Karnataka Cinemas (Regulation) Act, 1964 (Karnataka Act 23 of 1964) and the Rules made thereunder ('the Act and the Rules'). The petitioners in Writ Petitions Nos. 8943 to 8947 of 1984 are permanent cinemas licensees.

159. The touring cinema licensees have approached this Court to direct the District Magistrates to re-grant their licences without insisting on the production of 'No objection certificates' ('NOCs') under the Act and the Rules challenging the validity of S. 19(2)(c) of the Act, Rr. 96(5), (5A) and 107 of the Rules. The permanent cinema licensees have approached this Court to direct the District Magistrates to enforce the Act and the Rules against the touring cinema licensees. But, with the disposal of the cases filed by touring cinema licensees, there is hardly any ground to grant the-reliefs sought by the permanent cinema licensees.

160. We heard these cases earlier at length and in our separate opinions delivered on 132-1985, we concurred on the construction of R. 105, validity of S. 19(2)(c) and validity of Rr. 96(5) and (5A) of the Rules and disagreed on the validity of R. 107 of the Rules and by an order made on that day, refer-red the validity of R. 107 only for the opinion of another Hon'ble Judge of this Court. In pursuance of our said order and the further order made by the Hon'ble Chief Justice, these cases were heard by Rama Jois, J. and His Lordship has furnished his opinion on 27-6-1985. We have perused the opinion furnished by Rama Jois, J. and heard on the orders to be made by us.

161. In conformity with our earlier opinions and the opinion of Rama Jois, J. we make the following orders and directions :

(a) We strike down R. 107(l)(b) of the Karnataka Cinemas (Regulation) Rules, of 1971;

(b) We dismiss all these writ petitions except Writ Petitions Nos. 8943 to 8947 of 1984 in so far as they challenge S. 19(2)(c) of the Act, R. 96(5), (5A) and R. 107(l)(a) of the Rules. But, notwithstanding this, we direct the licensing authorities under this Act viz., the District Magistrates of the Districts to treat the respective re-grants made by them to t e concerned petitioner/s in pursuance of the interim orders made in these cases, as made for the full second year of that petitioner/s subject to R. 98(2) of the Rules and regulate the further re-grants in future in accordance with law and the observations made in this order.

(c) We dismiss Writ Petitions Nos. 8943 to 8947 of 1984 as having become unnecessary.

162. Writ petitions are disposed of in the above terms. But, in the circumstances of the cases, we direct the parties to bear their own costs.

163. Let this order be communicated to the respondents within IS days from this day.

164. Sri M. R. Achar, learned Government Advocate is permitted to file his memo of appearance for the respondents in all these cases within one month from this day.

165. Order accordingly.


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