The Daily News's lawyers had argued on the first day of the appeal hearing that the state-appointed media commission's refusal to grant the paper a registration certificate was politically motivated.
The paper has been off the newsstands since armed police forcibly shut it down last month and confiscated all its equipment.
Police moved onto the paper's premises in the capital after the Supreme Court ruled that the Daily News was operating illegally because it was not registered with media commission, set up shortly after President Robert Mugabe was re-elected in disputed elections in March last year.
The paper had earlier decided against registering with the commission, arguing that obligatory registration was against the constitution of the southern African country.
It subsequently submitted an application last month, but it was rejected.
The head of the licensing commission, Tafataona Mahoso, justified the denial of the licence saying it was a unanimous decision by four out of seven commission board members.
He said Thursday that his commission had denied the paper an operating licence because it had been declared an illegal media house by the Supreme Court.
But the Daily News argued that the decision not to register it was politically motivated, and that media commission chief Mahoso was "hostile and biased" against the group.
Mahoso insisted there had been no influence from the government on the decision to deny the Daily News a licence.
"The decision is not influenced by the Minister of Information (Jonathan Moyo)," he told the court on Thursday.
Advocate Eric Matinenga, who is representing the Daily News in the hearing, accused Mahoso of bias in the opinion articles he regularly writes for the state-run Sunday Mail.
He said one of the articles could give the impression that people working for the paper "are right-wing extremists dressed in civil rights robes".
"The impression is clear that you are biased against the Daily News and anybody associated with it," said Matinenga.
The Daily News has also questioned the legal status of the media commission arguing that it was not constituted in accordance with the law, which requires that some of its members be nominated by an association of media houses as well as journalists.
No media houses were involved in the nomination of the members of the commission's board members.
The closure of the Daily News and its sister paper, the Daily News on Sunday, has left about 300 full-time staff and nearly 1 000 vendors jobless.
Only two state-owned daily papers are now available for Zimbabwean readers, plus seven weeklies. – Sapa-AFP.
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