Archive · 22 Dec 2025
BMC's Rs 10,899-cr Property Tax Claim
The Brihanmumbai Municipal Corporation (BMC) in Mumbai has sent notices to many property owners demanding higher property taxes.
The BMC is using a new way to calculate taxes that was introduced in 2010, which considers the maximum possible building area on a plot, not just the existing structure.
This method was challenged in court, and both the Bombay High Court and the Supreme Court said it was not fair and should not be used.
However, the BMC is still sending bills based on a mix of the old and new methods.
Many property owners, including big companies and government bodies, say they are being unfairly charged.
The BMC says it wants to change the way taxes are calculated to make it fairer, but until then, many people owe a lot of money in taxes and penalties.
The BMC is trying to collect this money by attaching and auctioning properties of those who haven't paid.
BMC has sent notices to 481 properties demanding Rs 10,899.96 crore in pending property tax dues, including penalties.
The BMC introduced a new formula in 2010 based on potential Floor Space Index (FSI), which was quashed by the Bombay High Court in 2019 and the Supreme Court in 2022.
Despite court orders, the BMC continues to use a modified version of the formula, adding 100% of the old rateable value and 50% of the proposed CVS value.
The BMC claims that if penalties are quashed and a new policy is implemented, the outstanding amount could reduce to 25%-30%.
The BMC has attached and auctioned properties to recover unpaid taxes, facing challenges due to staff shortages and legal pending cases.
- Who
- Brihanmumbai Municipal Corporation (BMC) and property owners in Mumbai
- What
- BMC demanding higher property taxes based on a new formula, despite court orders
- When
- Notices sent in January 2025, with pending dues as of August 2025
- Where
- Mumbai, India
- Why
- BMC introduced a new formula in 2010 based on potential Floor Space Index (FSI), which was challenged and quashed by courts, but BMC continues to use a modified version of this formula
- Total Pending Dues
- Rs 10,899.96 crore (including penalties)
- Number of Defaulters
- 481 properties
- Biggest Defaulter
- Mumbai Metropolitan Development Authority (MMRDA) - Rs 714.31 crore
- Property Tax Collection 2024-25
- Rs 6,172 crore (99.54% of target)
- BMC's New Formula
- 100% tax amount as per rateable value + 50% of proposed CVS value
- Court Ruling
- Bombay High Court and Supreme Court quashed the new methodology in 2019 and 2022 respectively
- BMC's Stance
- Property tax should be calculated on the base value of the land
- Potential Outstanding Reduction
- 25%-30% if penalties are quashed and new policy is implemented
