Delhi HC Refuses Mandamus to Prescribe NDMC Property Tax Methodology, Tells Khan Market Association to Challenge Individual Assessments

A Division Bench dismissed a writ petition by the Khan Market Welfare Association, holding that courts cannot direct a statutory authority to formulate its own assessment methodology under Article 226.

The High Court of Delhi has dismissed a writ petition filed by the Khan Market Welfare Association challenging the manner in which the New Delhi Municipal Council determines rateable values for property tax. A Division Bench of Justice Anil Kshetarpal and Justice Shail Jain, pronouncing judgment on 21 August 2026, held that the three surviving prayers — directing NDMC to formulate a uniform assessment method, constituting an expert committee to probe alleged irregularities, and issuing a general compliance direction for several provisions of the NDMC Act, 1994 — were not reliefs amenable to a writ of mandamus. The court left open the right of individual assessees to challenge specific assessments through available statutory remedies.

The Dispute Before the Court

The Petitioner is an association of property owners, entrepreneurs and residents in commercial and mixed-use areas within NDMC's jurisdiction. Its core complaint was that NDMC had, since a 2019 Supreme Court ruling striking down the 2009 Bye-laws, continued to apply different assessment regimes to similarly situated properties — mixing actual rent, comparable rent, historical rateable values, and principles drawn from the Unit Area Method (UAM) — with no uniform methodology in place.

The 2009 Bye-laws had introduced a “Dual Method” of assessment incorporating UAM principles. In New Delhi Municipal Council & Ors. v. Association of Concerned Citizens of New Delhi & Ors., (2019) 15 SCC 303, the Supreme Court declared those bye-laws ultra vires. However, given that approximately 95% of assessees had already accepted and paid tax under them, the Supreme Court exercised powers under Article 142 of the Constitution to protect completed assessments from reopening.

NDMC's position before the Division Bench was that it continued rateable values for assessees protected by the Supreme Court's Article 142 directions, and determined rateable value afresh under Section 63(1) of the NDMC Act wherever a Section 72 notice was issued. It also referred to its Council Resolution dated 22 December 2019 and the Jan Vishwas (Amendment of Provisions) Bill, 2025, which it said proposes statutory amendments to introduce the UAM.

The Petitioner relied on assessment lists for Khan Market and Connaught Place, which it said showed properties similar in size, location and character carrying substantially different rateable values. It also cited the order dated 16 May 2024 passed in W.P.(C) 6815/2022 (Saroj Tandon v. New Delhi Municipal Council & Ors.), where a court had found the variation in rateable values “prima facie inexplicable.” NDMC countered that W.P.(C) 6815/2022 was itself dismissed on 6 February 2025.

The Legal Issue: Scope of Mandamus Against a Taxing Authority

The Petitioner pressed three prayers after abandoning its challenge to the expression “at any time” in Section 72 of the NDMC Act. Those prayers were: (a) a mandamus directing NDMC to formulate a uniform method for fixing rateable values until UAM is implemented; (c) constitution of an expert committee to probe alleged frauds and irregularities; and (d) a general direction to NDMC to strictly follow Sections 63, 65, 70, 71, 72 and 73 of the NDMC Act.

The Association also argued that NDMC cannot, through administrative practice, create different classes of properties and apply different yardsticks to them, since Section 63(1) of the NDMC Act prescribes a single statutory basis. It further contended that UAM application after the Supreme Court's judgment was impermissible, and that the Article 142 protection granted by the Supreme Court was limited to assessees who had already paid tax — it could not authorise prospective application of the invalidated bye-laws.

NDMC's response was that the expression “reasonable rent” in Section 63(1) is not a formula; it is a statutory standard whose application necessarily varies according to the facts of each property — its use, location, nature of occupation, and whether actual rent is distorted by extraneous circumstances. It also invoked Section 73 of the NDMC Act, which expressly permits the Chairperson to adopt an earlier rateable value with such alterations as may be considered necessary, to justify continuity of assessments.

How the Bench Reasoned

The Division Bench began by examining the limits of mandamus jurisdiction under Article 226. It reiterated that mandamus is issued to enforce a legal right corresponding to a legal or public duty; it does not empower a court to assume the statutory or administrative function of the authority itself. Citing Union of India v. S.B. Vohra, (2004) 2 SCC 150; Govind Sugar Mills Ltd. v. Hind Mazdoor Sabha, AIR 1975 SC 1735; and State of Mysore v. K.N. Chandrasekhara and Others, AIR 1965 SC 532, the court affirmed that where a statutory discretion exists, a court may require it to be exercised according to law but cannot itself exercise it or dictate the manner of its exercise.

On prayer (a), the court found that the relief sought was, in substance, a direction to formulate and administer a methodology for determining rateable values. That is precisely the kind of administrative function entrusted by the legislature to NDMC. The court held that judicial review goes to the legality of an exercise of power, not to the court undertaking the function itself. The fact that the existing arrangement might cause hardship, or that a different methodology might appear fairer, does not by itself ground a mandamus. The court referred to Tamil Nadu Education Department Ministerial and General Subordinate Services Association v. State of Tamil Nadu, (1980) 3 SCC 97, for the principle that a court will not interfere with administrative policy merely because it perceives a more desirable alternative.

The court drew a sharp distinction: mandamus is available in taxation matters where a levy is shown to be unconstitutional, ultra vires the statute, or beyond the authority's jurisdiction. It is not available where the complaint is essentially that a statutory authority has adopted a particular assessment methodology and the relief sought is a direction to substitute another. Since the Petitioner had abandoned its constitutional challenge to Section 72, what remained was a request to prescribe the assessment system — a function the court declined to perform.

Prayer (c) fared no better. The court found that constitution of an expert committee armed with powers to inquire into alleged frauds, invite stakeholder suggestions, and devise future safeguards would require the court to create an administrative mechanism and prescribe its composition and remit. No statutory duty requiring such a committee was identified. In the absence of a demonstrated legal right and a corresponding legal duty, the prayer could not be sustained.

Prayer (d) — a general direction to comply with Sections 63, 65, 70, 71, 72 and 73 of the NDMC Act — was equally unavailable. The court held that a statutory authority is already bound by its governing statute. A general supervisory direction to ensure compliance, without identifying a particular duty that has been refused or neglected, does not amount to enforcement of a specific legal right. The court noted that specific statutory violations, if they occur, can be challenged in appropriate proceedings.

The court also addressed the capacity in which the petition was filed. The Petitioner is an association; the alleged prejudice from rateable value determination and property tax levy is suffered by individual property owners. The proceedings were not framed as a public interest litigation. An association cannot, by aggregating individual grievances, seek a mandamus for enforcement of rights that are personal to its members. Citing Indian Sugar Mills Association v. Secretary to Govt., Uttar Pradesh, (1950) All LJ 767, the court held that unless the association itself demonstrates an infringed right, or brings itself within permissible parameters of representative or public interest action, the prayers cannot be maintained.

The court also noted the procedural history at some length. The present petition was preceded by several rounds of litigation on overlapping property tax grievances in the NDMC area. W.P.(C) Nos. 6815/2022, 8101/2022 and 8306/2022 were dismissed by a Division Bench on 6 February 2025. A further batch of ten petitions raising overlapping grievances was dismissed on 4 December 2025. In that context, the court observed that the present petition represented a subsequent attempt to agitate, through an association, issues that had already been pursued by individual property owners.

Having reached its conclusion on maintainability, the court expressly declined to examine the factual and legal submissions on the merits of the underlying grievances. It recorded that it had not expressed any opinion on whether rateable values were, in fact, being assessed or property tax levied arbitrarily by NDMC.

Order

The Division Bench dismissed W.P.(C) 3534/2024. Prayers (a), (c) and (d) were held not amenable to a writ of mandamus as framed. Prayer (b), the challenge to the expression “at any time” in Section 72 of the NDMC Act, was not adjudicated upon since it was not pressed.

The court clarified that the dismissal does not preclude any individual assessee from availing remedies available under the NDMC Act against a particular assessment — including challenges to a specific determination of rateable value, non-compliance with statutory procedure, or unreasonable delay in finalisation of proceedings.