MCD, NDMC Propose Reforms to Simplify Property Tax Assessment

The Municipal Corporation of Delhi (MCD) and the New Delhi Municipal Council (NDMC) are not exactly known for efficiency or kindness when it comes to property tax. Citizens have complained for years about confusion and the messy paperwork. Now, under the Jan Vishwas (Amendment of Provisions) Bill, 2025, both civic bodies are proposing reforms. The stated goal: make tax assessment simpler, less painful, and a little more transparent.

NDMC’s big move: the unit area method

NDMC wants to replace the old, cranky “rateable value” method with the unit area method for calculating property tax. That sounds like jargon, but here’s what it means: instead of pegging tax to some arbitrary idea of rental value, the calculation would be based on six actual factors viz., unit area value, property size, use, structure type, age, and tax rate. In theory, this is cleaner. It’s been used in MCD areas since 2003–04, so it’s not a brand-new experiment, as per a report by ET Realty.

But there’s baggage. NDMC tried sneaking this method back in 2009 as a bye-law, without touching the original law. Delhi High Court killed it in 2017. The Supreme Court agreed in 2019. Why? Because you can’t rewrite the rules without rewriting the Act itself. In other words, the law said “rateable value,” and NDMC said, “Let’s just pretend.” The courts called the bluff, the report added.

Now, NDMC is asking for proper legal backing. But here’s the kicker: adopting the unit area method means changing 47 provisions of the NDMC Act. That’s not minor. That’s full-scale surgery. Officials admit it’ll make things fairer, but anyone familiar with Indian municipal reforms knows fairness usually crawls at the pace of a snail carrying bricks, as per the report.

Markets like Connaught Place have been noisy about this for years. Shop owners get taxed under the old rateable value system, and it hurts. They want the unit area method, arguing it’s more rational, the report added.

MCD’s Own Tweaks: Seven Years, Not Forever

On the MCD side, the proposals are less flashy but very practical. First, they want to cap tax assessments at seven years. Right now, MCD has been known to raise bills going back to 2004 for properties where no tax was paid. Imagine getting a bill today asking you to cough up dues from two decades ago. The proposed change would mean that for seven years prior, the slate is clean.

Second, MCD wants physical surveys for first-time tax assessments. Sounds basic, right? Go look at the property, gather actual data, then send the bill. But until now, assessments have often been cooked up without proper ground checks. This proposal, if enforced honestly, would reduce disputes. Citizens have been demanding this kind of common sense for years.

Decriminalisation: Fines, Not Jail Time

Furthermore, both bodies propose a shift from criminal to civil punishments. It means that minor infractions, such as failing to file a notice on time, will no longer result in jail threats. NDMC alone wants 105 provisions changed, converting imprisonment clauses into penalty-based ones. Examples include Section 298, which deals with sanitation workers absent from duty, and Section 390, which punishes breaches of bye-laws.

MCD is pushing for a similar approach under Section 461 of its Act. Instead of dragging people to court or threatening prison, penalties would be imposed for failures like not declaring property tax liabilities, not giving notice before constructing a building, or not reporting property transfers. The tone is obvious: stop treating taxpayers like criminals for administrative slip-ups.