The petition came up before a bench headed by Justice V M Kanade which decided to place the matter for final hearing after four weeks.
Though the Maharashtra government circular was issued in 1968, the Cinema Owners and Exhibitors Association claimed that it was kept in abeyance and only "recently" did the government begin to enforce it, acting under pressure from the Marathi film producers' lobby.
Petitioners also claimed that there weren't enough Marathi movies being produced and Marathi movie producers were unwilling to offer commercial rates for booking theatres despite getting huge state government subsidies.
"We are not averse to exhibiting Marathi films as long as it is commercially viable and for that they do not need any circular," the petition said.
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The petition stated that in 2005, only 16 Marathi films were screened; in 2006 the number of films rose to 73 and in 2007 it dipped to 31 films.
According to the 1968 government circular, the rule for mandatory screening of Marathi films was to encourage "indigenous" films.
However, the Association said that the term indigenous meant 'locally made' and the government relied on a narrow reading of the term by placing only Marathi films in that category.