CHL Limited, a leading player in the hospitality and hotel industry, has received a significant legal update concerning the imposition of differential property tax by the Municipal Corporation of Delhi MCD. The matter relates to the writ petition filed by CHL Limited in 2004 before the Hon’ble High Court of Delhi under W.P.(C)-17113/2004, challenging the notification issued under the Delhi Municipal Corporation Act, 1957 and related laws governing differential property tax on hotels.

On 12th September 2025, the Hon’ble High Court of Delhi disposed of the writ petition against the Petitioner-Company, pronouncing an order in favour of the Municipal Corporation of Delhi. This order effectively upholds the imposition of differential property tax by the MCD, which had been contested by CHL Limited for over two decades.

The key terms of the order highlight that the High Court’s decision is final and that CHL Limited is required to comply with the taxation norms set by MCD. While the company continues to review the financial and commercial impact arising from this legal decision, the order does not specify any immediate cash outflow or penalties, but the long-term financial planning for Delhi properties may be affected.

CHL Limited has communicated this development to stock exchanges including BSE, NSE, and in compliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. This includes providing detailed disclosures under Regulation 30, ensuring transparency and timely information for investors and stakeholders.

The order explicitly confirms that there is no involvement of the promoter or promoter group companies in this legal matter. Additionally, it is clarified that the transaction does not fall under related party transactions, maintaining corporate governance compliance and avoiding any conflict of interest issues.

From a corporate perspective, this legal development emphasizes the need for hotels and real estate businesses operating in Delhi to align with the MCD regulations on property tax. Differential property tax implies that hotels are assessed differently from other commercial properties, which may lead to increased operational costs for businesses like CHL Limited.

CHL Limited, known for its extensive hotel portfolio and strong market presence, is actively assessing the commercial implications of this High Court decision. The management aims to implement strategies to mitigate financial impacts while ensuring regulatory compliance. Such legal outcomes also influence investor sentiment, as property taxation policies directly affect profitability and return on investment for listed hospitality companies.

This High Court order is an important reminder of the complex legal landscape in which hotel operators function in India. CHL Limited’s commitment to disclosing the order in a timely manner and following SEBI guidelines reflects its adherence to transparency and corporate governance standards, which is crucial for sustaining investor confidence and maintaining stock market credibility.

Going forward, CHL Limited will continue to monitor legal, financial, and regulatory aspects of the order while updating stakeholders as necessary. The company’s proactive communication ensures that shareholders, potential investors, and market participants are informed of all developments that may impact corporate performance and compliance obligations.

The Delhi High Court’s order underlines the importance of understanding and planning for regional property tax regulations, especially for large hospitality businesses. Companies must carefully evaluate long-term financial strategies to accommodate taxation policies without compromising operational efficiency or market growth.

In conclusion, CHL Limited’s writ petition challenging the MCD’s differential property tax on hotels has been disposed against the company by the Delhi High Court. The company is now assessing the financial and operational impact while ensuring full compliance with SEBI disclosure requirements. Investors and stakeholders can access the detailed order and related updates through CHL Limited’s corporate communications and stock exchange filings.

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