Paharganj hotels, guest houses get ₹22.46 crore compensation notice: Delhi govt tells NGT

The submission came after the tribunal termed the voluntary disclosure scheme a “scam”, observing that unregulated groundwater withdrawal was allowed in the name of a scheme that did not exist.

The Delhi government has informed the National Green Tribunal that it has assessed an environmental damage compensation (EDC) of ₹22.46 crore against 536 hotels and guest houses in Paharganj for illegally extracting groundwater over 11 years. Of this amount, ₹4.36 crore has already been recovered, while steps are underway to realise the remaining dues, the government said in an affidavit.

The NGT has been hearing a plea filed by activist Varun Gulati alleging large-scale illegal groundwater extraction by hotels and guest houses in Paharganj. (HT ARCHIVE)

The affidavit, dated January 6 but uploaded recently, also states that the illegal extraction resulted in a loss of approximately ₹11 crore to the public exchequer. The submission, filed through the Delhi chief secretary, further proposes disciplinary proceedings against nine superintending engineers and executive engineers posted in the area between 2014 and 2024 for alleged dereliction of duty.

The tribunal has been hearing a plea filed by activist Varun Gulati alleging large-scale illegal groundwater extraction by hotels and guest houses in Paharganj. In December last year, the Delhi Jal Board told the tribunal that the Voluntary Disclosure Scheme (VDS), cited by several establishments to justify groundwater extraction, never had any legal standing. The board said the scheme was merely operationalised through a public notice in 2014 and was never formally notified.

The submission came months after the tribunal, in February 2025, termed the voluntary disclosure scheme a “scam”, observing that unregulated groundwater withdrawal had been allowed in the name of a scheme that did not exist.

In May last year, the tribunal had pulled up the chief secretary for failing to submit an action taken report in compliance with its January order. On January 29, the NGT had directed the chief secretary to ascertain the loss to the exchequer, environmental damage, impact on groundwater levels, and to fix responsibility on officials who allowed such extraction.

The report said an illustrative assessment of groundwater extraction in Paharganj led to a notional calculation of ₹11 crore as loss to the exchequer. “In the absence of any notification issued by the environment department, mandating the installation of water meters and prescribing rates for the extraction of groundwater, there is legal impediment in the recovery of the said amount,” it said.

The chief secretary said the Delhi Pollution Control Committee had earlier imposed an EDC of ₹4.50 crore and recovered ₹4.34 crore. Following NGT directions, a fresh assessment using Central Pollution Control Board methodology resulted in a revised EDC of ₹22.56 crore, with recovery proceedings underway for the remaining ₹18.12 crore.

“Though there is no evidence of misconduct on the part of superintending engineer or executive engineer, negligence or dereliction of duty… is evident. Therefore, it is proposed to initiate disciplinary proceedings against these officials,” the report said.