K. Ramaswamy, J. - (1.) The appellant has been exhibiting cinematograph films at Dhuri, on a licence having been granted by the District Magistrate, Sangrur, the 2nd respondent, under S. 5 of the Punjab Cinemas (Regulation) Act, 1952, for short'the Act'and the Rules. By proceeding dated February 26, 1975 the 2nd respondent classified the seats for admission into four classes and fixed the rates of admission to the respective classes. The appellant impugned as ultra vires of the power of licensing authority in this behalf and also contended that it offends its right to carry on the business under Art. 19(1)(g) of the Constitution. It equally questioned R. 4 of the Punjab Cinemas Rules and condition 4A of . the condition of the licence on that score. The learned single Judge declared the action to be ultra vires of the power and offends Art. 19(1)(g). On appeal in L.P.A. No. 913/80 dated April 3, 1981 (reported in AIR 1981 Punj and Har 230) the Division Bench reversed the judgment and upheld the power of the licensing authority. It also held that the regulation does not offend the right under Art. 19(1)(g) of the Constitution. This appeal arises on leave under Art. 136 of the Constitution.
(2.) The licensing authority by proceeding dated February 26, 1975 classified the seats into Box, First Class, Second Class/ Ladies and Third Class and prescribed the rates of admission of Rs. 2.75, Rs. 1.75, Rs. 1.30 and Re 0. 80 p., respectively. On obtaining interim stay of the orders, the appellant, pending the writ petition unilaterally enhanced the rates of admission. The question is whether the 2nd respondent has power under the Act. The preamble of the Act provides that "an Act to make provision for 'regulating' exhibition of cinematographs in the Punjab". The purpose of the Act, therefore, is to regulate the cinema trade or business in exhibiting the cinematograph in the theatre being run on the licence duly obtained from the licensing authority. S. 5 gives power to licensing authority thus:- "5. Restrictions on powers of licensing authority:- (1) The licensing authority shall not grant a licence under this Act unless it is satisfied that- (a) the rules made under this Act have been complied with, and (b) adequate precautions have been taken in the place, in respect of which the licence is to be given to provide for the safety of the persons attending exhibitions therein. (2) Subject to the foregoing provisions of this section and to the control of the Government, the licensing authority may grant licences under this Act to such persons as it thinks fit, on such terms and conditions as it may determine." Section 9 confers power on the State Government to make rules by notification published in the official gazette to prescribe terms, conditions and restrictions, if any, subject to which licence may be granted under the Act. R. 4 reads thus: "Licences, whether for a period of three years or temporary, shall be in form A annexed to those rules and shall not subject to the conditions and restrictions set forth therein and to the provisions by these rules". Condition 4A of the Licence granted under the rules provides "classification of the seats" and the "prices thereof" for different parts of the licenced building/ place, approved by the licensing authority as indicated therein and "shall not amend or alter the same in any way without the prior approval of the licensing authority". The licensing authority will enter the number of persons to be admitted into the several parts of the Auditorium having special regards to the provisions of R. 24. (Emphasis supplied)
(3.) It is settled that the rules validly made under the Act, for all intents and purposes, be deemed to be part of the statute. The conditions of the licence issued under the rules form an integral part of the statute. The question emerges whether the word regulation would encompass the power to fix rates of admission and classification of the seats. The power to regulate may include the power to license or to refuse the licence or to require taking out a licence and may also include the power to take or exempt from taxation, but not the powre to impose a tax for the revenue in rule making power unless there is a valid legislation in that behalf. Therefore, the power to regulate a particular business or calling implies the power to prescribe and enforce all such proper reasonable rules and regulations as may be deemed necessary to conduct the business in a proper and orderly manner. It also includes the authority to prescribe the reasonable rules, regulations or conditions subject to which the business may be permitted or conducted. A conjoint reading of S. 5, S. 9, R. 4 and condition 4A gives, therefore, the power to the licensing authority to classify seats and prescribe rates of admission into the cinema theatre.;