The building located in posh mid town Manhattan partly houses the Indian Mission to the United Nations which is exempt from tax. But New York city is demanding a tax on the 20 storeys occupied by its diplomatic staff.

India has been arguing that tax cannot be levied as the diplomatic staff who occupy the apartments, are exempted from tax, but US district court judge Jed S Rakoff ruled on Monday that under Vienna conventions, only the residence of head of the mission is exempted.

The Indian ambassador to the United Nations has a residence in a nearby building in Manhattan and the residential apartments in the Mission building are occupied by the junior diplomatic staff.

Besides, India, the judge also ordered Mongolia to pay 4.3 million and the Philippines 10.9 million dollars.

Mongolia’s tax obligations arise from the two floors of its six-storey building occupied by the staff.

But the Philippines case is quite different as it has rented parts of the building to a restaurant, an airlines office and bank.

However, the State Department had earlier opposed the move, fearing that the US would have to pay millions of dollars for the properties it had acquired in other countries.