@Abdullah Humayun - Thanks for the question and using MS Q&A platform.
According to the Peer virtual networks documentation, let's us understand the Virtual Network peerings options (without VNET vs with VNET) available in the Azure Databricks workspace.
Azure Databricks workspace created without VNet injection: Peer an Azure Databricks virtual network to another Azure virtual network
Note: Here the network is completely controlled and managed by Microsoft, that's the reason you will Virtual Network Peerings option enabled, and Networking option greyed out.
Which means, you can directly peer an Azure Databricks virtual network with another Azure virtual network by just clicking on Add Peering as shown.
Azure Databricks workspace created with VNet injection: Peer your own virtual network to another Azure virtual network
Note: Here the network is completely controlled and managed by you, that's the reason you will Virtual Network Peerings option greyed out, and Networking option enabled.
You can see the Virtual Network name associated with your Azure Databricks workspace as shown below:
In order to add the virtual networking peelings, you can go to associated virtual network, under settings, select Peerings and just click on Add as shown.
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