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Property tax untapped source of revenue for MCDs: HC

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New Delhi: The Delhi High Court today said that a “major source of revenue” for the municipal corporations in the form of property tax was “going untapped” as the number of people paying the tax comprised one-fourth or less of the total number of dwelling units under them.

A bench of justices Badar Durrez Ahmed and Sanjeev Sachdeva were of the view that if all the dwelling units under the corporations are brought under the tax net, the “enhanced revenue” would help them to address the responsibilities cast on them.

The court also said that by bringing everyone under the tax net, the quantum of tax being imposed can also be reduced.


It said that currently “people who break the law, benefit and those who follow it, do not. Those who do not follow the law are allowed to progress higher and higher. That is the moral of the story”.

After perusing the affidavits filed by the north and south MCDs regarding the number of dwelling units in their area and how many of them were paying property/house tax, the court said “it is evident that in south Delhi municipal corporation (SDMC) area only 25 per cent are paying property tax and this figure is much worse in north MCD.”

“Insofar as East MCD was concerned, there is no total figure so we cannot estimate as to the percentage of dwelling units in respect of which property tax is to be collected. However, this much is clear that a major source of revenue for the MCDs is going untapped,” the court said and directed the three corporations to “as early as possible” start collecting the tax.

The court also said that by bringing everyone under the tax net, the quantum of tax being imposed can also be reduced. It said that currently “people who break the law, benefit and those who follow it, do not. Those who do not follow the law are allowed to progress higher and higher. That is the moral of the story”.

The high court also directed the government to ensure that a “state-level advisory committee” be set up in one week from today and said “all the Commissioners of the three corporations, Chairperson of New Delhi Municipal Council and CEO of Delhi Cantonment Board shall be personally liable for ensuring compliance of the Solid Waste Management Rules”.

The directions came while the court was hearing a PIL regarding maintaining cleanliness in the national capital. The bench, during the hearing, also referred to a recent incident of a eight-year-old boy’s death after he fell into an open drain in the middle of a footpath at Shakurpur in north west Delhi.

With regard to the incident, Delhi government assured the court that compensation would be provided to the family of the child at the earliest and that action would be taken against the “erring officials” and “remedial measures undertaken to prevent future occurrence of such incidents”.

The court also issued directions to the corporations to “carry out surprise checks (of whether safai karamchaaris are on the job) during their working hours and to keep a documented record of the same so that there is no dispute”.

It sought a status report from the corporations regarding the surprise checks carried out and listed the matter for further hearing on July 13 when the bench will take up the issues of land for landfill sites and water connection for public toilets.