Delhi civic body identifies commercial users paying residential tax, ET RealEstate

May 15, 2025 Clicktoprints

NEW DELHI: Are you using a commercial electricity connection but paying property tax at residential rates? If your answer is in the affirmative, beware. You may receive a notice from Municipal Corporation of Delhi in the near future.

Aiming to increase its tax collection for the financial year 2025-26 and identify defaulters, the civic body is referencing the electricity bills generated by the power discoms. Officials said that the tax inspectors were provided with electricity bills of 10,000 commercial properties, and they had already verified the status of 3,200 properties.

“These commercial properties were selected based on their addresses. Of these 3,200 properties, we identified mismatches in 421 properties. In many instances, people were using a commercial electricity connection but paying property tax to MCD at residential rates. MCD will serve notices to such defaulters and ask them to correct the information and pay the arrears to avoid action,” said an official.

These electricity bills will also help in identifying people who are not paying the property tax at all.

Before initiating the exercise, the civic body prepared a portal wherein property tax inspectors have to feed information after their visit to properties. “The idea is to fix responsibility. After they visit, they need to feed details of properties, their status and any errors. The tax inspectors will be held accountable if any difference is found in the future,” said the official.

The civic body has over 100 inspectors in the property tax department.

During 2024-25, MCD’s property tax collection reached approximately Rs 2,163 crore from 11.33 lakh properties against the projected target of Rs 4,000 crore. This figure was less than the collection of Rs 2,137 crore in FY 2023-24. MCD clarified that after the political announcements regarding 100% exemption of property tax on properties below 100 sq yards and a 50% rebate for properties between 100-500 sq yards made in Feb, there was complete confusion among taxpayers, resulting in a decline in collection.

The civic body achieved a higher collection of Rs 2,417 crore in FY 2022-23, attributed to the implementation of an amnesty scheme. The number of taxpayers also declined from 13.3 lakh in 2022-23 to 12.6 lakh in 2023-24.