One of Scotland's leading arts venues has been ordered to close for six weeks after police discovered dozens of men engaged in indecent acts within a concealed area.

Strathclyde Police uncovered the incident after receiving several complaints over a number of months that "acts of public indecency" were taking place at a monthly club run at the Arches in Glasgow.

During an arranged visit to the Burly night in March this year two uniformed officers found up to 30 men "in various states of undress" and engaging in sexual activity in a corner area covered by black mesh.

Despite the presence of two uniformed officers several of those taking part continued with the activity before disappearing into the crowd. One man was arrested and reported to the procurator-fiscal.

After a formal police complaint was made to the City of Glasgow Licensing Board, the Arches was told yesterday to shut its doors for six weeks after it was accepted the management was "not fit and proper" to hold the entertainment licence.

The venue is to lodge an immediate appeal and will continue to trade prior to the case being taken to the sheriff court, where management hope the board's decision will be overturned.

Failing that, the venue will have to comply with the sanction, shutting the entire Arches operation and then paying the local authority's legal costs.

It has already axed the Burly event, which attracted older gay men from all over Scotland.

At yesterday's licensing board meeting Superintendent John Farrell, Strathclyde Police's head of licensing, said the force was first informed that activities were taking place in the concealed area in December 2007 following a complaint from a member of the public but this was denied by management.

At February's event senior Arches staff monitored proceedings, but a further complaint was received by police in early March after which the police visit was arranged.

According to Mr Farrell both officers arrived at around 2am on March 8 and immediately made their way to the covered area where "group sex" was taking place.

Mr Farrell then said that at a subsequent meeting with Mark Anderson, the Arches' executive director, Mr Anderson claimed the area was somewhere where customers could go for "a kiss and a cuddle"

He added: "Lest the chief constable's position be misinterpreted, it is not of any significance that on this occasion the sexual activity involved members of the gay community.

"Group sexual activity involving heterosexuals or people of any other sexual preferences would not be any more or less serious."

Archie Maciver, representing the Arches, said the venue had 18 years with an unblemished reputation, was an arts venue of global renown and that as it was 85% self-financing any closure would have a major impact upon it.

While insisting it was "beyond question" that the "rather sordid" incident occurred, he said that, given its reputation, it would be wrong to label the management "not fit and proper", adding that the Burly night had been running at the Arches for five years without any problems.

But the board's chairman, Councillor James McNally, questioned the Arches about other complaints and occurrences over the five years, claiming "credibility springs to mind" and that he could not accept it was an isolated incident.

Mr Anderson said afterwards: "We regret the decision taken by the board and will consider an appeal, while continuing to trade while that process is under way. We take our responsibilities seriously and will continue to review our operations."