Smoke ban rebel Hamish Howitt has won his appeal against Blackpool Council's decision to revoke his premises licence for Delboy's Sports Bar.
Howitt had been accused of breaching three licensing objectives on public safety, crime and disorder and the protection of children from harm.
But a district judge at Blackpool Magistrates' Court ruled that no breach had taken place, despite Howitt permitting smoking in the bar.
He told thepublican.com: "I told the judge I would keep smoking and she said if she could have closed me on that she would have. But there is no provision in law, under the 2003 Licensing Act to do that."
"It's like David and Goliath. I'm taking on the whole establishment. I feel I'm doing the right thing."
Blackpool Council has vowed to appeal the decision in the High Court.
Peter Callow, leader of Blackpool Council, said: "We are disappointed that Mr Howitt's appeal has been upheld.
"We believe the district judge has made the wrong decision.
"We are not seeking to be heavy handed. The council has a duty to enforce licensing legislation and will continue to rigorously ensure public safety."
Howitt claimed he had been persecuted by the council and said he would be seeking a private prosecution against a senior protection officer.