Gurnams store, in Marsden Road, Horsley Hill, South Shields, was caught selling alcohol to children on four separate occasions, between 2005/2006.

Residents had also reported gangs of drunken youths gathering, intimidating passers by, smashing bottles and urinating in the street.

As a result, the store had its licence to sell alcohol revoked at South Tyneside Council's licensing sub-committee in October last year.

The action prompted Gurnams's licensee Kavel Shabilla to appeal against the council's decision.

However, the appeal was dismissed at South Tyneside Magistrates' Court yesterday.

The result is the first total ban of an off-licence selling alcohol in the borough since the new licensing laws were introduced in 2005.

The ban came into effect at midnight.

Magistrates awarded the council £4,000 costs.

Chairman of the Bench, Keith Ahmed, said: "We have considered all options available to us today, but feel that the permitting of sales to be made to minors is most serious.

"In particular, we note that Mrs Shabilla, in reality, is continuing to be involved in alcohol sales.

"This Bench cannot find any conditions that, if implemented, would allay our concerns. We therefore dismiss Mrs Shabilla's appeal."

The court heard how the store owners installed CCTV cameras, which seemed to curb the anti-social behaviour problems.

The decision was welcomed by leader of South Tyneside Council, Coun Iain Malcolm.

He said: "I am delighted for residents, who have suffered long enough at the hands of groups of rowdy youths.

"There is a clear link between selling alcohol to children and anti-social behaviour."

The action is the result of partnership working between Northumbria Police and a number of council teams, including trading standards, licensing, community safety, the community wardens and legal services.

Peter Sutton, the neighbourhood police inspector for the area, said: "The link between alcohol and offending is well documented.

"This is a powerful message to other premises that they have a position of responsibility which will be monitored closely by police and partner agencies."

The store can still appeal, but it has to be on a point of law. The owners did not wish to comment.