Supreme Court Directs SDMC To Sanction Residential Plans Within Four Weeks, Holds Owners Not Compelled To Convert Ground Floor To Commercial Use

A bench of Justices J.B. Pardiwala and K.V. Viswanathan heard an appeal by the South Delhi Municipal Corporation challenging concurrent orders that had granted deemed sanction to building plans for demolition and reconstruction of a nearly 85‑year‑old residential house on Ansari Road, Darya Ganj. The appeal questioned whether the owners could demolish the dilapidated structure and rebuild it exclusively for residential use in an area notified for mixed land use.

The Court dismissed the appeal and upheld the orders of the Tribunal–MCD, the Additional District Judge and the High Court that had granted deemed sanction to the respondents’ plans. The Court held that the statutory scheme and the Master Plan did not permit the municipal authority to compel owners of pre‑existing residential properties on notified streets to convert the ground floor to commercial use. The Court, in its reasoning, observed: “Secondly, the Master Plan for Delhi, 2021 makes it amply clear that the areas notified for mixed land use are to· be used for commercial purposes to a limited extent. Shops are permitted on plots abutting notified streets albeit only on the ground floor and upto the maximum permissible ground floor coverage. This does not imply that the owners of residential property on notified streets are compelled to develop the property in that manner and apply for change of user. It is also relevant to mention that the change of user for developing the properties for partly commercial use on notified streets is permissible on payment of the conversion charges.” The Court further emphasised the municipal conduct and observed that the SDMC’s insistence on compulsory commercial development amounted to harassment, calling the conduct “nothing short of harassment.” The Court permitted the respondents to submit fresh plans and directed the authority to sanction residential plans “within a period of four weeks from the date of presentation.” The Court also imposed costs of Rs.10,00,000 on the appellant, payable to the respondents by 17.12.2025.

Background

The respondents owned adjoining residential plots (Nos. 4752 and 4758) at 23, Ansari Road, where their ancestral house stood since circa 1940 and had become dilapidated. They sought permission in 2010 to dismantle and rebuild the house for residential use. When the municipal authority did not decide the application, the respondents approached the Appellate Authority–MCD (a tribunal under s. 347A of the Delhi Municipal Corporation Act), which allowed the application and granted deemed sanction. The SDMC appealed to the Additional District Judge, which dismissed the appeal on 13.02.2012; the High Court dismissed the subsequent writ petition on 11.05.2015 and a review petition on 01.06.2017. The SDMC argued before the Supreme Court that the new bylaws and the Master Plan (MPD‑2021) required mixed use on notified streets and that ground floors must be commercial. The respondents countered that the MPD and the Urban Development Department’s circulars permitted mixed use but did not make it compulsory, and that they intended exclusive residential use. The Supreme Court examined relevant circulars and precedent (including observations in M.C. Mehta), concluded that owners could choose residential use without compelled conversion, and found the SDMC’s late‑raised insistence inconsistent with its earlier stance. The Court dismissed the appeal, allowed the respondents liberty to place the same or fresh plans before the authority, ordered sanction within four weeks, and imposed costs of Rs.10 lakh for the SDMC’s conduct. The respondents were permitted to proceed with residential construction and to rely on plans earlier approved by the High Court.

Case Details: Case No.: 2025 INSC 1324 (Civil Appeal No. 6077 of 2018; connected Civil Appeal No. 6078 of 2018) Case Title: South Delhi Municipal Corporation through its Commissioner v. Bharat Bhushan Jain (dead) through LRs Appearances: For the Petitioner(s): Ms. Vandana Sehgal, Advocate For the Respondent(s): Mr. Paul, Senior Advocate