1. Notwithstanding anything in section 13, licensing authority shall refuse to grant-

(a) a license under section 3, section 4, or section 5 where such license is required in respect of any prohibited arms or prohibited ammunition:

(b) A license in any other case under Chapter II,-

(i) where such license is required by a person whom then licensing authority has reason to believe-

(1) to be prohibited by this Act or by any other law for the time being in force from acquiring, having in his possession or carrying any arms or ammunition, or

(2) to be of unsound mind, or

(3) to be for any reason unfit for a license under this Act, or

(ii) where the licensing authority deems it necessary for the security of the public peace or for public safety to refuse to grant such license.

2. The licensing authority shall not refuse to grant any license to any person merely on the ground that such person does not own or possess sufficient property.

3. Where the licensing authority refuses to grant a license to any person it shall record in writing the reasons for such refusal and furnish to that person on demand a brief statement of the same unless in any case the licensing authority is of the opinion that it will not be in the public interest to furnish such statement.