Entrepreneur Mark Smith had already been given planning consent by West Berkshire Council last year for a split level club for affluent twentysomethings, but officials backed police in court on Monday when Mr Smith appealed.

Police were worried that granting a 2am weekend licence would create too much of a nuisance, and were supported by some neighbouring residents.

Inspector Pete Edwards said after the two-day hearing: "We are pleased that our objections were upheld. There were genuine concerns that if the licence was allowed that it would impact on the quality of life of local residents.

"We have a responsibility to the local community and a duty to act if there is any possibility of a negative impact. We also have to consider the logistics of policing a location such as this. Newbury town centre is a safe place to socialise and we want to keep it this way."

Police had already refused an offer by Mr Smith to install a £7,000 surveillance system, linked up to the main CCTV control room in the town hall.

The ruling comes as South African restaurateur Angus Gordon prepares to open a wine and cocktail bar in the former Beatties toyshop.

Brian Leahy, Senior Licensing Officer at West Berkshire Council said," The Council have worked closely with Thames Valley Police to prevent this licence so that residents living close to the site are protected from excessive noise and behavioural nuisance".

The only other places with late night licences are Seymours, aimed at the over 30s, and Liquid nightclub, aimed at 18-24 year olds.