The State Government must act quasi-judicially when deciding applications under Section 118 of the H.P. Tenancy and Land Reforms Act, and decisions based on perverse reasoning are subject to judicial review.

Judgment :

(Satyen Vaidya, J.)

Aggrieved against the order/communication dated 18.07.2024 (Annexure P-5) issued by respondent No.2, petitioner has invoked the jurisdiction of this Court under Article 227 of the Constitution of India for following relief:

“A. A direction be issued under the Supervisory jurisdiction to annul the order-cum-communication dated 18.07.2024 (Annexure P-5) passed by respondent No.2 as being patently perverse based on illegal consideration and to direct the respondents to decide the application of the petitioner for the grant of the Section 118 Permission strictly in terms of law within stipulated time without considering the objections as mentioned in the order-cum-communication dated 18.07.2024 (Annexure P-5).”

2. The case as set-up by the petitioner is that it had purchased a piece of land measuring 9-07 Bighas after obtaining permission dated 6.5.1981 from the State Government under Section 118 of the H.P. Tenancy and Land Reforms Act, 1972 (for short, “The Act”) for establishment of an industrial unit. The petitioner started its industrial production on 10.03.1984. The unit of the petitioner was registered with the Department of Industries on 01.02.2014. On 24.04.2023, the petitioner has entered into an agreement to sell with M/s M.T. Autocraft Private Limited whereby the land purchased by the petitioner has been agreed to be further sold to M/s M.T. Autocraft Pvt. Ltd.

3. As the petitioner is obligated to seek prior permission of the State Government to sell the land as per the provisions of the Act, petitioner initiated the process for the same and finally the Deputy Commissioner, Solan recommended the case of the petitioner to the State Government on 20.02.2024 in terms of Rule 38A (2) (a) of the H.P. Tenancy and Land Reforms Rules, 1975 (for short, “The Rules”).

4. The State Government is the competent authority to take final decision on the application of the petitioner. When the decision making was delayed by the competent authority, the petitioner approached this Court by way of CMPMO No.375 of 2024. The said petition was disposed of by a co-ordinate Bench of this Court vide order dated 28.06.2024 in following terms:

“11. Accordingly, I deem it appropriate to dispose of this petition by directing the competent authority to decide the application submitted by the petitioner after taking into consideration the recommendations made by the Deputy Commissioner, Solan on or before 12th July, 2024.”

5. Thereafter, the impugned order/communication was issued whereby the application of the petitioner has been rejected.

6. I have heard learned counsel for the parties and have also gone through the records of the case carefully.

7. The grounds for rejection of the application of the petitioner have been mentioned in the order/ communication dated 18.07.2024 as under:

“(a) M/s Hemkunt Iron & Steel Pvt. Ltd. purchased land to set up an industry after taking permission under Section 118 of the H.P. Tenancy and Land Reforms Act, 1972 in the years 1981. The land should have been put to use within two years, however, the certificate issued by the Deputy Director Industries, dated 02.12.2023 mentions that the industry “started production in 1984 as acknowledged by this office on 01.02.2014”. Therefore, it appears that production was actually delayed beyond the permissible limited. This is in violation of the act and the very purpose of permission under Section 118 seems to have violated.

(b) Further it is cleared from the record that the construction of the shed was taken up in the year 2005 which was on 105 square meter area out of total 7037.08 Sq. meters, total plot area. This also points out that the constructed area was only a small shed on more than 09-07 bigha land. This also shows that seller has actually violated the provisions of the act and has deliberately not produced entire record to show the exact position of the site. This can be verified from the valuation report submitted with the case.

Therefore, this