Rebel Hamish Howitt has been banned from being Designated Premises Supervisor (DPS) at his pub because he flouted the smoking ban.
The move sets a dangerous precedent as police claim flouting the ban undermines the crime and disorder objective of the Licensing Act.
The refusal comes just days after Howitt won his appeal against the revocation of the premises licence at Delboy's in Blackpool.
Howitt applied to transfer the DPS from his wife Joanne to himself on 19 February.
Mr Howitt has shown complete disregard for the law and police have no faith in him to promote the licensing objectivesBlackpool police
The application was refused on 11 April after an objection from the police.
Police claimed that Howitt was not a "suitable person to promote the licensing objectives due to his stance in relation to the smoke free legislation".
Police Sargeant Giffin added: "His position clearly undermines the crime and disorder objective."
In addition, police took issue with the political banners adorning Delboy's Sports Bar.
"This is a clear demonstration of the applicant's inability to operate within the law and is in conflict with the promotion of the licensing objectives," said Giffin.
He added: "Mr Howitt has shown complete disregard for the law and police have no faith in him to promote the licensing objectives."
Police also sighted his "willingness to ignore his licence conditions with regards to door security".
Law of the land
A council spokeswoman said: "The Health Act 2006 is the law of the land and to contravene it is an offence and therefore the crime and disorder licensing objective does apply and would be undermined.
"This forms the basis of our decision in as much as it would be wrong to have a DPS blatantly selecting laws to uphold."
Howitt said: "My stance against the smoking ban is political. I don't see it as any different from a speeding fine.
"I am going to appeal right away."
MA legal editor Peter Coulson added: "The police are clearly acting in conjunction with the Local Authority.
"Whether defying the smoking ban constitutes an offence under the crime and disorder objective remains debatable."