S.63AA Gujarat Tenancy & Agricultural Lands Act | Collector Can't Deny Industrial Land Use Certificate Over Technical Defects: High Court

The Gujarat High Court has held that the Collector cannot reject an application for grant of land use certificate under Section 63AA of State Tenancy and Agricultural Lands Act on technical deficiencies.

For context, Section 63AA of the Gujarat Tenancy and Agricultural Lands Act, 1948 enables a person to buy agricultural land provided that it is to be used for bona-fide industrial purposes.

Allowing the petition, the Court quashed the Collector's order rejecting the petitioner's application reflected “overstepping of jurisdiction” and lacked application of mind; it also permitted the petitioner to file a fresh application for consideration in accordance with law.

Justice Vaibhavi D. Nanavati observed:

“To this Court, it would appear that the revenue authorities had clearly exceeded their jurisdiction in rejecting the application of the petitioner for grant of permission for bona fide industrial use on the ground that there is no details with regard to the share of one of the original owners… On one hand the revenue authorities have overstepped their jurisdiction and on the other hand the revenue authorities did not apply their mind to the issue in question.”

The court noted that under Section 63AA the purchaser has to intimate the Collector within 30 days of the purchase and furnish relevant particulars, failing which fine can be imposed. Upon receipt of such application the Collector has to satisfy himself that the purchase has been made for bona fide industrial purpose in accordance with the statutory parameters and thereafter, issue a certificate in favor of the purchaser and if the Collector is not satisfied then he can refuse to grant the certificate after affording the purchaser an opportunity of hearing.

It noted that Section 63AA is administrative in nature and does not involve any adjudicatory process or quasi-judicial function.

The Court thus held that the Collector's rejection based on technical deficiencies cannot be treated as a decision on merits, observing:

“Rejection of an application on the ground of deficiency or technical defect cannot be termed as an order on merits under Section 63AA…If the rejection is based purely on technical or procedural deficiency then filing of an appeal before the Appellate Authority for removal of the same would be contrary to the provisions of Section 63AA. Thus, an applicant can file a fresh application after removal of deficiencies.”

The petitioner company purchased land at Village Fazalpur, Vadodara, through a registered sale deed for the purpose of setting up an industrial unit. The transaction was reflected in the revenue records through Entry No.1491. Subsequently, the petitioner applied for grant of certificate under Section 63AA of the Tenancy Act to use the land for industrial purposes.

The Collector rejected the petitioner's the application on 07.07.2024, citing inability to verify agricultural certificates of previous occupants, lack of clarity regarding revenue entries, and non-production of certain documents such as the DLR map.

Appearing for the petitioner, Advocate Prateek S. Bhatia contended that the impugned order was “wholly arbitrary, mala fide, and passed without due application of mind.” He submitted that the Collector had travelled beyond the scope of Section 63AA, which only requires satisfaction regarding bona fide industrial use.

He further argued that the power under Section 63AA is administrative in nature and upon receiving notice from the purchaser within 30 days of purchase, the Collector is required to hold an inquiry to satisfy himself that the purchase was made for bonafide industrial purposes and thereafter issue a certificate. Any other rejection would be “de hors the said provision (and) is… beyond jurisdiction,” rendering the order unsustainable.

Opposing the petition, AGP Jwalant Vora submitted that the Collector had acted in accordance with statutory provisions and was required to conduct an inquiry to satisfy himself that the land was validly purchased for bona fide industrial purposes. He argued that if the Collector was not satisfied, he was empowered to refuse the certificate and the petitioner's remedy was to prefer an appeal before the competent authority rather than invoke writ jurisdiction.

The Court clarified that the Collector's function under Section 63AA is administrative and limited to examining whether the purchase was for bona fide industrial purposes.

It observed that “Section 63AA of the Bombay Tenancy and Agricultural Lands Act does not confer to the Collector any quasi-judicial power but he exercises an administrative function.”

The Court observed that the revenue authorities had exceeded jurisdiction by rejecting the application on the ground that details regarding the share of one of the original owners was not mentioned. Further, the Court held that the petitioner's undertaking should have satisfied the revenue authorities on this matter, even though the authorities did not have any right to verify such a detail in the first place.

Accordingly, the Court held that the Collector's order was unsustainable, and quashed it.

It directed that if the petitioner files a fresh application, the Collector shall consider the same independently and in accordance with law.

Case Title: Advance Greenfield Pvt Ltd Through Its Director Surendrakumar Netaram Sharma v. State of Gujarat & Anr.

Case No.: R/Special Civil Application No. 11771 of 2024

Appearance: Advocate Prateek S. Bhatia for the Petitioner; Jwalant Vora, AGP for the State.

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