Use Of Premises As Homestays Or Hostels Cannot Be Permitted Without Permission From Authorities: Gujarat High Court

The Gujarat High Court recently held that operating premises as a Home Stay or Paying Guest (P.G.) hostel without proper registration and mandatory permissions from the authorities is illegal and cannot be permitted to run a business. The Court offered the 8 guests residing in such premises to make alternative arrangements within one week.

Justice Mauna M. Bhatt observed, “…considering the averments made in the affidavit of respondent corporation that for use of premises either as Home Stay or as P.G. Hostel, necessary registration/ permission from the concerned authority is mandatory. Moreover, conditions referred in the policy are also required to be fulfilled. Therefore, this Court deems it appropriate to direct respondents to widely publicize by appropriate means the requirements to be fulfilled prior to use of premises either as Home Stay or P.G. Hostel.”

The petition was filed challenging the notice of 23rd April 2025 wherein, the petitioners were asked to vacate the subject premises used as P.G. hostel within a week. The Court then issued notice on 22^nd May,2025 and the order was passed on 11^th June by Ahmedabad Municipal Corporation (AMC) to seal such premises calming it was being used a P.G. hostel and not Home Stay without permission and it was accommodating 8 guests excluding owner (petitioner no. 1) who leased it to 2 people (petitioner no. 2 and 3) who were running the P.G. hostel.

The petitioner stated that after the order of 11^th June, they filed an application to seek registration of Home Stay before the State Authority which was pending, therefore, the order to seal the premises may not be “acted upon”, following which an order on 13^th June was passed directing the Corporation to open the seal.

The Government Pleader (GP) appearing for the Corporation submitted that after the Court's order of 13^th June, the seal was removed and the original petitioners, along with 8 guests, were allowed to stay in the premises. Further, he submitted that the premises are used as a PG Hostel without the Corporation's permission and false averments are made on oath stating the premises is used as Home Stay. The GP then urged the Court that the petitioner may not be permitted to use the subject premises illegally and the seal order of 11^th June be restored.

The AGP then pointed out that the application seeking registration of Home Stay is rejected; hence, the petitioners should not be allowed to use the subject premises and stated to the Court that the order of 11^th June should be acted upon.

The Counsel appearing for the petitioners submitted that the Corporation's reply was received a day before the present hearing and requested a week's time to file a rejoinder, adding that the order of rejection for the Home Stay registration has not been received.

The Court, after considering the submission of the parties, observed that the notices of 23^rd April and 11^th June are challenged on the ground of use of the premises by the petitioner as Home Stay. The Court noted that it is not disputed that it was a non-registered Home Stay and the application was later rejected.

The Court then held, “Therefore, in the opinion of this Court, the petitioners cannot be permitted to run the business by having illegal use of the subject premises. On the above fact situation, it is directed that order dated 13.06.2025 directing the respondents to open the seal and to permit the petitioners to use the subject premises is continued for further period of one week from 17.06.2025. In the meantime, it is open for the 8 guests (other than petitioner Nos.2 and 3) to make alternative arrangements for their stay.”

The matter was then listed to 24.06.2025.

Case Title: Mukesh Bhanwarlal Bhandari & Ors. vs State of Gujarat & Ors.

Case Number: SCA No. 7277 of 2025

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