Chandni Chowk traders, North MCD at odds over conversion charge

The North Delhi Municipal Corporation’s move to collect conversion charges -- a one-time fee for using residential complexes for commercial purposes -- from some traders in Chandni Chowk area, also known as ‘Delhi-6’, has drawn criticism from businesses in the area which claim they are exempt from such charges since they fall in the special zone. North MCD, however, insists that only shops registered before 1962 are exempt from conversion charges.

Bharat Ahuja, the president of Delhi Electrical Traders’ Association, said that some traders of Bhagirath Palace and Azad Market have recently received notices to pay conversion charges. “These charges are collected by civic bodies whenever there is a change in land-use of any particular area. Everyone knows that this area was commercial since the Mughal period and it comes under the special zone. The Delhi Development Authority (DDA) is also all set to include this area in its Master Plan. The North MCD has no legal right to ask the traders to pay such charges,” he said.

He further said that on March 3, 2008, the Supreme, noting the “accepted position that no registration of commercial establishments in special areas is required in view of the Master Plan Delhi (MPD-2021) provisions”, disposed off petitions requesting the same.

“Clause 16.2 of MPD 2021 says that owners/occupiers of the properties in special areas using them for commercial activities are not required to be registered and pay consequential conversion and car parking charges. All the commercial units of special areas are not supposed to register themselves. And if we do not need registration, where is the question of conversion and parking charges,” he added.

Sanjay Bhargava, the president of Chandni Chowk Sarv Vyapar Mandal, accused the North MCd of harassing traders in the name of conversion charges. “The North MCD is sending notices to commercial markets. These markets are commercial since their inception. So asking for such charges is plain harassment. Because of the MCD’s greed, they have not regularised many buildings. DDA has already passed a notification in 2018 against the civic bodies for seeking conversion charges in such markets,” he said.

Showing another order passed by the triple bench of the Supreme Court of India on May 14, 2007, in the Chandni Chowk Sarv Vyapar Mandal versus Union of India and Others case, which stated “in the view of the stipulations in the Master Plan, there shall not be any registration of the establishments as it is in Special Area (sic)”, Bhargava said that North MCD has issued the notices for conversion charge without getting that order cancelled.

“Most of these markets are in existence before Independence, but the North MCD officials are asking traders to come with proof of their establishment year. Before anything else, they should have started a public awareness camp to inform us about what sort of charge it is that the MCD wants to collect from us and the order or law it is based on. We feel that this is like extortion,” he said.

When asked about the legality of such notices, Shekhar Kumar, a Supreme Court advocate and expert of municipal laws, said that following the order of the Supreme Court in 2007, MCD stopped asking traders of Chandni Chowk for registration charges initially, but again started seeking conversion and parking charges “in a few years”. “Special areas are completely different from other areas. Areas that do not fall under the ‘special area’ category have development or redevelopment codes, which have all the details of the conversion and parking charges. But for special areas, MCD has not come up with any redevelopment scheme. So asking Chandni Chowk traders to pay conversion and parking charges is simply a contempt of court,” he said.

“The North DMC will have to come up with some development or redevelopment plans for Chandni Chowk first. Only then can the traders be asked to pay these charges,” he added.

When contacted, a senior North DMC official said that all the traders of Delhi have to pay conversion and parking charges, irrespective of the areas where they operate. “According to the Master Plan, those shops, which came up before 1962 don’t have to pay any conversion charges, while the shops came up after 1962 have to deposit all the charges,” he said, asking not to be named.