The direction was issued at a meeting attended by Deputy Chief Minister Manish Sisodia, PWD minister Satyendar Jain and Development minister Gopal Rai.
Besides, Chief Secretary Anshu Prakash and senior officials of the Delhi Jal Board (DJB) and the Irrigation and Flood Control Department also took part in the meeting.
The chief minister has directed that the development works in all unauthorised colonies should to be completed this year, an official said.
Directions were also issued by the chief minister to set a colony-wise deadline for completion of the development works, the official said.
However, the party has challenged the EC's decision in the Delhi High Court.
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