UT Guest House Of Daman & Diu, Lakshadweep In Delhi Taken Over By Hotel, Raises Land Use Concerns

In Delhi’s tony diplomatic enclave of Chanakyapuri, all tree-lined avenues, tulip beds and stately embassies, a new address has quietly appeared: Ginger Hotel Chanakyapuri. Yet, in a neighbourhood where the galaxy of state and Union Territory Houses stands in careful order, there is a curious absence. Dadra and Nagar Haveli Daman and Diu and Lakshadweep Houses seem to have vanished. In their place is a 59-room edifice of brown sandstone, its façade sober and unassuming.

The Union Territory Houses of Dadra and Nagar Haveli and Daman and Diu and Lakshadweep in Delhi’s Chanakyapuri have been taken over by Ginger Hotels, a subsidiary of the Indian Hotels Company Limited (IHCL), which is part of the Tata Group. The property is now listed on the Ginger website as Ginger Chanakyapuri. Experts say this is a violation of the law.

What was once a few-rooms UT House, is now a 59-room structure, of which 19 belong to Lakshadweep and the rest is with Daman and Diu. Twelve rooms have been allocated in all to both the UTs for official use when union territory officials come to the capital.

The agreement, however, was understood to be for providing housekeeping and facility management services, including the provision of cleaning materials, at the UT guest house complex. The UTs function from the same address.

The Administrator for both UTs is Praful Kodabhai Patel, who was earlier Home Minister of Gujarat when Narendra Modi was the Chief Minister.

Unlike most State Bhawans in the capital, there is no functional state representative at the front office of the Daman and Diu Bhawan, while the main entrance to Lakshadweep House remains locked. A single liaison officer serves both territories, stating that his primary role is to coordinate between the UT administrations and the Union government, and to facilitate the stay of visiting officials. The office is behind a door labelled ‘meeting’ and is just behind the main reception area of the hotel’s lobby.

Urban planning experts have raised questions over the arrangement. “Under the Delhi Development Act, 1957 and the Delhi Master Plan, this is not permitted. The area is designated as residential (guest house use), and such activities are not allowed. Even a change of land use is not permissible, as the land was allotted at a concessional rate and is not intended for commercial or marketing purposes,” explained A.K. Jain, former Commissioner (Planning) of the Delhi Development Authority

According to Jain “this kind of activity cannot be carried out in such areas.” He further explained that because the land was provided on concessional terms, “it cannot be repurposed for marketing activities or commercial use.” Jain, who was a key architect of the Master Plan for Delhi 2021, emphasised that such restrictions are clearly defined within the planning framework.

The land was allotted in 1992 for the construction of the guest houses, which were completed between 2003 and 2004. A major renovation of the premises began in 2019 under the Union Territory administration and was completed between late 2022 and 2023, with work continuing through the Covid-19 period.

Under Delhi’s Master Plan 2021, land allotted to state governments is categorised as institutional use and cannot be fully converted for commercial purposes. “Only a portion of the built-up area may be used commercially, typically for like-minded organisations such as public sector undertakings,” said K.T. Ravindran, former head of urban design at the School of Planning and Architecture and ex-chairman of the Delhi Urban Art Commission.

In 2023, the Union Territory administrations of Dadra and Nagar Haveli & Daman and Diu, and Lakshadweep, signed an agreement to jointly manage the Chanakyapuri guest house facilities.

In September 2023, the Daman and Diu administration floated a tender for the “selection of an agency for the operation and maintenance” of the guest houses of Dadra and Nagar Haveli & Daman and Diu, along with Lakshadweep Bhawan, in Chanakyapuri, New Delhi. The tender, initially valued at Rs 94 lakh for a period of 24 months, was awarded to the Indian Hotels Company Limited (IHCL).

However, the arrangement, according to sources, effectively grants IHCL control over the 5,000 sq metre property for 15 years. By August 2024, an agreement was signed with IHCL and it took over the running of the House. In September 2025, they celebrated their first anniversary.

A Union Territory official described the move as a “decision taken at the level of the government”. Praful Patel has served as Administrator of Daman and Diu since 2016 and assumed additional charge of Lakshadweep in December 2020.

State Bhawans in Delhi are intended to function as administrative hubs, providing accommodation, liaison services and office space for visiting officials and residents of the respective states or Union Territories. Typically, residents can stay at these facilities at subsidised rates; at Daman and Diu House, rooms were priced at around Rs 750 per day.

According to the Resident Commissioner Priyanshu Singh in Daman and Diu, this arrangement nominally continues. Residents may still access rooms at the subsidised rate, subject to availability. In practice, however, most bookings are now routed through Ginger Hotels, with tariffs ranging from Rs 7,000 to Rs 13,000 per night.

Outlook has sent questionnaires to IHCL, UT and the ministry of housing, and are awaiting their response.