Nikolic can watch Vic races, but not ride

Jockey Danny Nikolic will return to Victorian racecourses, but he'll only get as far as the grandstands.

A Victorian Supreme Court Judge on Wednesday formally lifted a police order banning the once-great rider from setting foot on any racecourse in the state.

But Racing Victoria has declined the 2003 Caulfield Cup winning jockey's application for a rider's licence.

Mr Nikolic applied for a licence after serving a two-year ban for threatening chief steward Terry Bailey at a Seymour race meeting in 2012.

The ban expired on September 30 this year, having been extended when Nikolic behaved offensively during an appeal.

But a Racing Victoria sub-committee found he was not a fit and proper person to hold a rider's licence.

Racing Victoria wrote to Mr Nikolic last month advising him his application had been rejected several days after Victorian stewards were advised he was banned from Victorian racecourses.

Mr Nikolic took the Victorian Police Commissioner Graham Ashton to court after learning of the ban, which worked in the same way as a disqualification or warning-off imposed by racing authorities.

When Mr Nikolic appeared in the Victorian Supreme Court on Wednesday, Justice Kevin Bell was told by a lawyer for Mr Ashton that the order had been revoked.

Justice Bell ordered Victoria Police to pay Mr Nikolic's costs, but would not grant an order requested by Mr Nikolic's lawyer for them to pay indemnity costs.

The 40-year-old jockey was also denied a rider's licence by Racing Queensland last month.

One of Australia's best jockeys at his peak, Nikolic's big-race wins include the Caulfield Cup and the VRC Oaks.