The movie had received a green signal by the Central Board of Film Certification (CBFC). But while bookings opened for all other Friday releases in multiplexes, 'Madras Cafe' was not included.
The decision to screen or not rests in the hands of individual theatres and multiplexes.
A senior member of The Theatre Owners' Association, said, "The decision to release the film has been given to individual theatres. Since the government has not banned the film, the theatres are free to screen. But if they feel they might face the wrath of protestors, then we can't do anything."
'Madras Cafe' is set against the Sri Lankan civil war and also depicts the 1991 assassination of former Indian prime minister Rajiv Gandhi. It came under the scanner after Tamil activists alleged that it portrays the LTTE cadres as terrorists.
Multiplexes fear that releasing the film could make matters worse.
"We fear releasing the film might aggravate the ongoing protests. We don't want to risk it and, moreover, the decision to screen the film lies with each theatre," a multiplex representative, on condition of anonymity, said.
Also featuring Nargis Fakhri, Rashi Khanna, Ajay Rathnam and Leena Maria Paul, 'Madras Cafe' is a fictional story inspired by true events.
On Thursday, the Tamil version of 'Madras Cafe' was granted a U/A certificate with no cuts for release in Tamil Nadu.
A representative of the movie's co-producers Viacom18 Motion Pictures said they had also sought police protection to ensure a smooth release of the film.
Co-produced by John Abraham, who is also playing the lead in it, the film was shown here as part of a special preview on August 18. The objection against the film by protestors grew stronger thereafter.
Tamil filmmaker Seeman, head of Naam Tamizhar (We Tamils) group, said the film was "nauseatingly anti-Tamil".
In a related development, the Bharatiya Janata Party's Tamil Nadu unit chief Pon Radhakrishnan had said the movie should not be released in any part of the country.