HC says Delhi civic body can levy fees for commercial use of industrial area
This story was originally published at 17:47 IST on 7 July 2025
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NEW DELHI – The Delhi High Court has held that the Municipal Corp. of Delhi can levy conversion charges for commercial use of an industrial area. The court dismissed a batch of petitions by the Delhi Factory Owners' Federation, Supreme Motors Pvt. Ltd., and others challenging the municipal corporation's show-cause notices for collecting conversion charges.
"Thus, when the MPD (Master Plan for Delhi) 2021 and the provisions of the DMC (Delhi Municipal Corporation Act) are read in a conjoint and purposive manner, it becomes abundantly clear that the issuance of show-cause notices by the MCD (Municipal Corporation of Delhi) seeking to levy conversion charges for commercial use of industrial plots is not an action bereft of jurisdiction," the court said. On the contrary, it is an exercise of power squarely within the municipal domain, undertaken in furtherance of its statutory obligations to regulate land use and augment civic revenues, the court said. Therefore, the challenge to the jurisdiction of the corporation to issue such notices is without merit, it added.
The court asked the petitioners to file their revised responses to the show-cause notices within two months. Thereafter, the municipal corporation will pass a speaking order within four months, after affording due opportunity to the petitioners to be heard, it said.
The petitioners had argued that the provisions of the Delhi Municipal Corporation Act do not give the civic body the authority to levy conversion charges. They further said that in the context of an industrial area, only the Delhi State Industrial and Infrastructure Development Corp. Ltd. is empowered to collect such charges.
The municipal corporation said the role of the Delhi State Industrial and Infrastructure Development Corp. was confined to regulating and collecting charges for the conversion of land tenure from leasehold to freehold. Consequently, it was the Municipal Corp. of Delhi that was statutorily empowered under the Delhi Municipal Corporation Act to impose and collect conversion charges when permitting any change in land use in accordance with the Master Plan for Delhi 2021. End
Reported by Surya Tripathi
Edited by Rajeev Pai
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