Private Markets Require Gaon Panchayat and Government Approval, Not District Commissioner's Nod: Gauhati High Court Clarifies S.107 of Panchayat Act - 2025-09-24

Tracking Legal Developments.

Gauhati High Court Quashes Orders on Goalpara Cattle Market, Clarifies Approval Authority Under Panchayat Act

Guwahati, Assam – In a significant ruling clarifying the jurisdictional boundaries for sanctioning private markets, the Gauhati High Court has quashed a series of conflicting orders issued by the Goalpara district administration and the state's Panchayat and Rural Development (P&RD) Department concerning the operation of a private cattle market. Justice Devashis Baruah held that under Section 107 of the Assam Panchayat Act, 1994, only the concerned Gaon Panchayat and the State Government have the authority to grant prior approval for private markets, not the District Commissioner.

The court's decision untangles a complex legal battle involving two rival cattle markets, the local Panchayat, and various administrative bodies over the right to operate on Fridays.

Case Background: The Battle of the Friday Markets

The dispute centered on the "Gournagar Damribhasha Bridge Tiniali Pashuhat," a private cattle market established in 2013 by Abdul Mozid and another individual on their patta land. This market traditionally operated on Fridays.

The conflict escalated when the Jaleswar Anchalik Panchayat attempted to settle the private market via tender and later supported the establishment of a rival market, the "New Weekly Hat of Bashmura," which also operated on Fridays in close proximity. This led to a series of administrative interventions:

• August 7, 2024: The District Commissioner (DC) of Goalpara ordered the Gournagar market to shift its operations to a day other than Friday, allowing the Bashmura market to operate instead.
• September 30, 2024: Following a High Court directive to seek government approval under Section 107 of the Panchayat Act, the Principal Secretary of the P&RD Department, instead of deciding on the application, simply approved the DC's earlier order.
• May 30, 2025: In a surprising reversal, the District Development Commissioner (DDC) of Goalpara permitted the Gournagar market to reopen on Fridays.

This final order was challenged by both the rival Bashmura market and the Jaleswar Anchalik Panchayat, leading to the current batch of writ petitions.

Arguments Before the Court

• Mr. KN Choudhury , senior counsel for the Gournagar market owners, argued that the DC's order was without jurisdiction as Section 107 of the Panchayat Act does not empower the district administration to regulate private markets. He contended that the Principal Secretary, P&RD, failed to exercise his statutory duty by merely rubber-stamping the DC's illegal order instead of independently assessing their application for approval.

• Mr. P Bora , senior counsel for the Jaleswar Anchalik Panchayat, and Ms. BS Goyal , counsel for the Bashmura market, challenged the DDC's subsequent order allowing the Gournagar market to reopen. They argued that the DDC could not overrule an order effectively approved by the Principal Secretary and that the permission was granted without the necessary approvals from the Panchayat and the government.

Court's Analysis: A Jurisdictional Masterclass

Justice Devashis Baruah meticulously dissected the statutory framework governing private markets in Assam. The court's analysis rested on key legal provisions:

• Section 107 of the Assam Panchayat Act, 1994: The court identified this as the primary law, stating, "no private hats, ghats and fisheries shall be allowed to operate within the area under the jurisdiction of a Gaon Panchayat without prior approval of the concerned Panchayat authorities and Government."

• Identifying the "Panchayat Authority": Through a conjoint reading of Section 25(3)(b) of the Act and Rule 47(19) of the Assam Panchayat (Financial) Rules, 2002, the court concluded that the "concerned Panchayat authority" for granting approval is the jurisdictional Gaon Panchayat , which is also empowered to levy taxes on such markets.

From this, the court reasoned that the District Commissioner and District Development Commissioner have no role in this approval process. The judgment states:

"The perusal of Section 107 of the Act of 1994 nowhere empowers the District Commissioner or the District Development Commissioner to grant any approval for operating a private hat. Therefore, the order dated 07.08.2024 passed by the District Commissioner, Goalpara was on the face of it, without jurisdiction and authority."

The court also heavily criticized the Principal Secretary, P&RD, for abdicating his responsibility. It noted that he was required to independently apply his mind to the approval application but instead chose to approve the DC's non-jurisdictional order, thereby failing to exercise the power conferred upon him by law.

Furthermore, the court dismissed the petition filed by the rival Bashmura market, finding it had no locus standi (right to sue). The court noted that the Jaleswar Anchalik Panchayat had allowed them to operate since April 2023 without following the mandatory tender process under Section 105 of the Act, rendering their operation "absolutely illegal and non est."

The Final Verdict and Directions

The Gauhati High Court delivered a decisive judgment, setting aside all three contentious administrative orders and providing clear directions for the future:

• The orders dated 07.08.2024 (DC) , 30.09.2024 (Principal Secretary) , and 30.05.2025 (DDC) are all set aside and quashed .
• The petition by the Bashmura market [WP(C)No.3389/2025] is dismissed for lack of locus standi.
• The Principal Secretary, P&RD Department , is directed to reconsider the application submitted by the Gournagar market owners for approval under Section 107 of the Act within 30 days .
• The owners of the Gournagar market must also obtain prior approval from the jurisdictional Katarihara Gaon Panchayat , in addition to the government's approval, to operate legally.

This judgment serves as a crucial reminder to administrative bodies to operate strictly within their statutory domains and clarifies the two-tier approval mechanism—from both the local Gaon Panchayat and the State Government—required for the lawful operation of any private market in Assam.