China's film authorities suspended the license of Beijing Max Screen after the fiml distribution company was found guilty of inflating box office numbers of its recently released movie "Ip Man 3," state media Xinhua reported.

The suspension, which will be implemented immediately, bars Beijing Max Screen from distributing movies for one month.        

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Ip Man 3 is the third installment of the franchise starring Donnie Yen and former boxing star Mike Tyson. It was released in China on March 4. The movie's distributor claimed that it earned ¥500 million ($77 million) in just four days of its release.

However, other distribution companies cried foul, accusing Beijing Max Screen of manipulating the box office numbers. The matter was eventually investigated by the State Administration of Press, Publication, Radio, Film and Television (SAPPRFT). 

SAPPRFT found that receipts from 7,600 screenings were faked by the distribution company as they could not be accounted in official box office figures. The governing body also issued warnings to three online ticketing agencies and to some 73 cinemas in the case.       

Beijing Max Screen has fully accepted the penalty notice. 

"As a company entering the film market, we are eager to make a contribution to Chinese film, but we lacked a deep understanding and familiarity with the relevant regulations. The company solemnly pledges to learn from the experience and comply with the rules," Max Screen said in a statement.          

In the past, several well known Chinese films were embroiled in ticketing scandals. Producers of last year's hit movie Monster Hunt admitted to buying tickets worth ¥40 million ($6 million). The movie's producers later claimed that the tickets were bought for free screenings of senior citizens.

Experts claim that distributors and producers are often lured by enormous size of China's movie market. China is currently the second largest movie market in the world, but is soon expected to overtake the United States to become world's largest. 

In January, SAPPRFT said that it will soon launch an application to help cinema goers report fake tickets as a part of crackdown against fake ticketing scandals.   

TagsIp Man 3, Ip Man 3 in China, Ip Man 3 Scandal, ticketing scandals in China, fake box office, movie market in China, biggest movie market