Trade licence need not be insisted for film exhibitions under Municipalities Act: Karnataka High Court

The Karnataka high court has stated that trade licence under section 256 of the Karnataka Municipalities Act cannot be insisted upon solely for the purpose of exhibition of cinematographic films. Justice Suraj Govindaraj said this while partly allowing the petition filed by Kesari Enterprises, Bengaluru.

The petitioner challenged the December 9, 2024, notice issued by the City Municipal Council, Chintamani in Chikkaballapura district, directing to obtain a trade licence under section 256 of the Karnataka Municipalities Act, for screening the films in a local cinema theatre.

The petitioners contended that running a cinema theatre is regulated under the Karnataka Cinemas (Regulation) Act, and not by the Municipalities under Section 256 of the Act. Once a licence is granted by the Deputy Commissioner under the special enactment, no further trade licence under the Karnataka Municipalities Act is required for exhibition.

On the other hand, the local body submitted that the petitioners must obtain a trade licence for exhibiting films to the public. According to the local body, exhibition of films constitutes a commercial activity conducted within municipal limits and, therefore, attracts regulatory oversight under the KM Act. It was further argued that ancillary commercial establishments, including food vending units and similar businesses, require licences and regulatory permissions.

After perusing the statutes, the court noted that both enactments must be interpreted in a manner that allows each to operate within its intended field without rendering the other nugatory. The court further said that the petitioners cannot rely upon their cinema licence to bypass municipal regulation of independent commercial operations conducted within the premises.

“It is declared that the activity of exhibition of cinematographic films, being regulated under the Karnataka Cinemas (Regulation) Act, 1964, does not fall within Item Nos. 2 and 3 of Part I of Schedule XIII to the Karnataka Municipalities Act, 1964 and therefore does not attract the requirement of a trade licence under Section 256 solely on that ground,” Justice Suraj Govindaraj said, while setting aside the notice asking the petitioners to obtain a trade licence under the KM Act.

The court further said, “It is clarified that if the petitioners are carrying on any ancillary commercial activities within the premises, including but not limited to food vending businesses or any other trade falling within Part I or Part II of Schedule XIII, it shall be incumbent upon the petitioners to obtain appropriate licences in accordance with law before carrying on such activities, either directly or through vendors, contractors or third parties.”