Delhi Development Authority vs Mala Sahni Seth & Anr.

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
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Date of Decision: 03 July, 2026
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Uploaded on: 6 July, 2026
+ CONT.APP.(C) 15/2026
DELHI DEVELOPMENT AUTHORITY .....Appellant
Through: Mr. C. Mohan Rao, Sr. Adv., Mr.
Rajeev Lochan Mahunta, Ms. Naina
Chauhan, Mr. Sahil S Panwar, Mr.
Rahul, Advs., Mr. Naresh - Dealing
Manager.
versus

MALA SAHNI SETH & ANR. .....Respondents
Through: Mr. Saurabh Seth, Mr. Sukrit Seth, Ms.
Neelampreet Kaur, Mr. Abhiroop
Rathore, Mr. Kabir Devi and Mr.
Sukhvir Singh, Advs.
CORAM:
JUSTICE PRATHIBA M. SINGH
JUSTICE VIKAS MAHAJAN
Prathiba M. Singh, J. (Oral)
1. This hearing has been done through hybrid mode.
CM APPL.40236/2026 (for exemption)
2. Allowed, subject to all just exceptions. Application is disposed of.
CM APPL.40234/2026 (for condonation of delay)
3. The present application has been filed seeking condonation of delay of
43 days in filing the present appeal.
4. For the reasons stated in the application, the delay is condoned.
5. The present application is allowed and disposed of accordingly.

CONT.APP.(C) 15/2026 Page 1 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

CONT.APP.(C) 15/2026 and CM APPL. 40235/2026 (for stay)
6. The present appeal has been filed by the Appellant-Delhi Development
Authority under Section 19 of the Contempt of Courts Act, 1971, inter alia ,
assailing the impugned order dated 18th March, 2026 passed by the ld. Single
Judge in Cont.Cas(C) No. 438/2026 titled ‘Mala Sahni Seth and Anr. v.
Delhi Development Authority’ .
7. The issue that has arisen in the present case is in respect of conversion
of the Respondents’ property from leasehold to freehold.
8. The issue whether Goods and Services Tax (hereinafter, ‘GST’) would
be liable to be paid on such conversion processes is pending before a Co-
ordinate Bench of this Court in various writ petitions, which have been filed
by some lessees. One such petition is before a Co-ordinate Bench of this Court
being Writ Petition(C) 16214/2025 titled ‘Mala Sahni Seth & Anr. vs. Delhi
Development Authority & Ors.’ .
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9. In Writ Petition(C) 16214/2025 , vide order dated 05 December, 2025,
the Court had observed as under:
“1. This hearing has been done through hybrid mode.
CM APPL. 66322/2025 (for stay)

2. Adjournment has been sought on behalf of Delhi
Development Authority (hereinafter, ‘DDA’) on the
ground that the matter is being considered at the higher
level as this has a huge revenue impact for DDA.

3. Insofar as the GST Department is concerned, it is
submitted by ld. Counsel for the GST Department that
the GST Policy Wing is looking into the matter.

4. On the previous date of hearing i.e., 30th October,
2025 the Court had directed DDA and GST Department
CONT.APP.(C) 15/2026 Page 2 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

to file their respective counter affidavits.

5. However, counter affidavits have not been filed by the
DDA and GST Department.

6. In any event, in the present case, the application of
the Petitioner for conversion from leasehold to
freehold need not be held back on this ground .

7. The undertaking of the Petitioner is recorded to the
effect that if the Petitioner does not succeed in the
present case, the demand for GST would be honoured
as per the directions of this Court.

8. Let an affidavit of undertaking be filed to this effect
by the Petitioner. Subject to the said undertaking, it is
directed that the DDA shall process the application for
conversion from leasehold to freehold.

9. It is also made clear that if the conversion takes
place and the Petitioner is intending to dispose of or
sell the property or create any third party interest, he
shall do so only with the permission of this Court.

10. Let the counter affidavits be filed within a period of
six weeks. Rejoinder be filed within four weeks,
thereafter.

11. List before the Joint Registrar on 4th February,
2026.

12. List before the Court on 17th April, 2026.

13. The interim order granted earlier to continue.”

10. In terms thereof, it was clearly directed that the application of the
Respondents for conversion of the property from leasehold to freehold would
CONT.APP.(C) 15/2026 Page 3 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

not be held back on the ground of the issue related to GST being pending. An
undertaking was recorded of the Respondents that, in case, the application is
processed and the Court directs that the GST demand would have to be
honoured, the Respondent would honour the same.
11. Mr. Saurabh Seth, ld. Counsel for the Respondent submits that the
undertaking in terms of the order dated 5th December, 2025 has already been
filed.
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12. Despite the order dated 5 December, 2025, it appears that the
conversion of the Respondents’ property from leasehold to freehold was not
processed and a Contempt Case (C) No. 241/2026 titled ‘Mala Sahni Seth &
Anr. vs. Delhi Development Authority’ , came to be filed by the Respondents.
13. The Contempt Case (C) No. 241/2026 was considered by a Coordinate
bench of this Court and vide order dated 11th February, 2026, it was observed
as under:
“1. Learned counsel appearing for the respondent
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states that, in the view of the order dated 05
December, 2025, and the undertaking furnished by the
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petitioners on 10 December, 2025, the request of the
petitioner for conversion of the land-in-question to
freehold shall be considered, and decision to that effect
will be communicated to the petitioner within a period
of four weeks from today.

2. Since the statement is made on instructions by the
learned counsel appearing for the respondent and the
same is accepted as an undertaking to this Court.

3. In view of the aforesaid statement, the contempt
petition stands discharged….”

14. As can be seen from the above order, the undertaking of the Delhi
CONT.APP.(C) 15/2026 Page 4 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

Development Authority (hereinafter, ‘DDA’) was recorded and the contempt
proceedings were discharged.
15. However, despite the aforesaid order, the conversion of the property
from leasehold to freehold was not processed. This led to filing of the
Contempt Case (C) 438/2026 titled ‘Mala Sahni Seth & Anr. vs. Delhi
Development Authority’ , before the ld. Single Judge.
16. In Contempt Case (C) 438/2026 , vide the impugned order dated 18th
March, 2026, the ld. Single Judge has primarily observed that the DDA has to
act in accordance with law and in terms of the previous orders, and complete
the aforesaid exercise for taking requisite decision on the conversion
application. The contempt petition was disposed of vide the impugned order
dated 18th March, 2026 and the following observations were made:
“12. A perusal of the aforesaid Office Order dated
19.01.2026 indicates that only the receipt of fresh
applications for free hold conversion have been put on
hold by DDA w.e.f 02.01.2026, however, there is no
impediment in consideration of the pre-existing
applications.

13. As such, the Office Order dated 19.01.2026 does not
pose any impediment to the consideration of the
petitioner’s application for taking the requisite decision
thereof. Also, the fact that the IDLI system is not
working cannot possibly be an impediment; it is for the
respondent to ensure that IDLI System is activated for
processing the case of the petitioner and other similarly
situated applicants.

14. In the circumstances, the respondent is directed to
act in accordance with law, and in terms of the orders
dated 05.12.2025 and 11.02.2026, and accordingly
complete the aforesaid exercise for taking requisite
CONT.APP.(C) 15/2026 Page 5 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

decision on the petitioner’s application for conversion
from lease hold to free hold.

15. The present petition stands disposed of in the above
terms.

16. Let an affidavit of compliance be filed within a
period of 12 weeks from today.”

17. The aforesaid order has been assailed by the DDA in the present appeal.
18. Mr. C. Mohan Rao, ld. Senior Counsel appearing for the DDA submits
that a policy decision is likely to be taken by the Ministry of Housing and
Urban Affairs on the conversion policy itself.
19. The aforesaid submission is opposed by Mr. Seth, ld. Counsel for the
Respondents on the ground that the office order dated 19th January, 2026
passed by the DDA itself states that any new policy, which would be passed,
would apply to fresh applications and not to already pending applications.
The said office order has also been relied upon by the ld. Single Judge.
20. The Court has heard the ld. Counsel for the parties.
21. It is a matter of which judicial notice can be taken by this Court,
wherein, in several cases pending before this Court in respect of flats in
various Co-operative Societies, the IDLI portal of the DDA for filing
applications seeking conversion of properties from leasehold to freehold has
itself remained non-functional since 2nd January, 2026.
22. The grievance of the non-functioning of the IDLI portal of the DDA
has been raised by a large number of citizens, of which notice has been taken
by this Court and a status report has been called in Writ Petition (C) No.
9034/2025 titled ‘Kanta Rani vs. Registrar of Cooperative Societies & Ors.’ .
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In the said case, vide order dated 22 May 2026, the Court has observed as
CONT.APP.(C) 15/2026 Page 6 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

under:
“4. Heard the ld. Counsels for the Parties. As is clear
from the above order that the regularization of the
Petitioner’s flat has been done and a recommendation
has also been sent to the Delhi Development Authority
(hereinafter “DDA”) by the Registrar Co-operative
Societies (hereinafter “RCS”).

5. However, there is a delay in the conversion of the
flat from lease hold to free hold, as the relevant portal
of the DDA is not functional. As soon as the portal is
functional, the Petitioner is free to apply afresh for
conversion and the same shall be processed within a
period of six weeks thereafter subject to all formalities
as applicable being completed.

6. At this stage, the Ld. Counsel for the Petitioner has
raised a serious objection that the portal of the DDA
for regularization of property is not functional since
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2 January, 2026.

7. This Court has also heard similar grievances in many
matters. Conversion of properties from leasehold to
freehold is an important step which enables citizens to
deal with their properties. Delay in the same could
severely hamper the interest of property owners.

8. Thus, the DDA ought to take immediate steps to
restore the functioning of the portal. Accordingly, let
the Vice Chairman, DDA file a status report as to the
reasons why the concerned portal is not functional, the
steps taken so far and a timeline by which the same
shall be functional. The status report shall be placed
on record within 4 weeks by way of an affidavit.

9. The petition is disposed of in the above terms.
Pending applications, if any, are also disposed of.

CONT.APP.(C) 15/2026 Page 7 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

10. List for compliance on 30th July, 2026.”

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23. The matter is, in fact, listed for compliance on 30 July 2026.
24. The conversion of properties from leasehold to freehold in the city of
Delhi is an important right available to citizens, enabling them to freely deal
with, transfer and otherwise transact in respect of their immovable properties.
The DDA cannot be permitted to keep this issue pending for such a prolonged
period, particularly when nearly seven months have elapsed without any final
decision being taken.
25. The matter would, no doubt, require consultation amongst the DDA,
the Ministry of Housing and Urban Affairs and the Ministry of Finance,
however, such consultation ought to have been undertaken and concluded at
the highest level with due expedition.
26. The continued delay from January, 2026 till July, 2026 in restoring and
facilitating the process of conversion of properties from leasehold to freehold
in Delhi is a matter of serious concern, as it adversely affects property owners
intending to enter into sale transactions in respect of their immovable
properties or finalise title in respect of their properties.
27. In fact, such delay is also likely to impede family settlements and other
bona fide transactions involving immovable properties. Accordingly, in the
larger public interest, it is imperative that a final decision in the matter is taken
at the earliest, without any further delay.
28. Accordingly, it is directed that a decision shall be taken in an
expeditious manner and the Vice Chairman, DDA shall file a status report as
directed in Writ Petition (C) No. 9034/2025 . Copy of the said status report
shall also be filed in the present matter.
CONT.APP.(C) 15/2026 Page 8 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42

29. The Vice Chairman, DDA shall also remain present in Court to assist
the Court on the next date of hearing.
30. The issue of maintainability of the present Appeal is left open at this
stage.
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31. List on 30 July, 2026.

PRATHIBA M. SINGH
JUDGE


VIKAS MAHAJAN
JUDGE
dss/dk/sm
JULY 3, 2026/
CONT.APP.(C) 15/2026 Page 9 of 9


Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:06.07.2026
19:32:42