On the Indian subcontinent, the word roughly means "mansion". Haveli Dharampura is more than 100 years old and used to belong to a Muslim nobleman - Old Delhi is the Muslim quarter of the Indian capital. It was in ruins when local lawmaker Vijay Goel, and his son, Siddhant, bought the three-storey building seven years ago. They have since renovated it while preserving the original features and have just opened Haveli Dharampura as a 13-room boutique hotel.

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The courtyard, with its pillars and scalloped arches, used to be the centre of family life. The ground-floor rooms all run off from the courtyard and, from the upper floors, it's possible to lean over the balcony and watch the comings and goings below. Several generations of one family would have lived here together, along with servants and retainers, yet the space feels compact and intimate.

Easy - the location. For the first time, it's possible to stay in comfort in Old Delhi.

A sensory overload. The quarter is packed with people and all manner of vehicles. It's here you will find the huge Red Fort and one of the largest mosques in India, the Jama Masjid, both built by Mughal emperor Shah Jahan. It's here, in the crowded, chaotic bazaar that you get India distilled, India enlarged, India concentrated, India essentialised. Escaping into the tranquil, elegant interior of Haveli Dharampura feels like crossing both a border and a time zone.

From the roof, Old Delhi is spread out before you; watch for long enough and you're likely to see children flying kites, men tending to their racing pigeons (a sport that also dates back to the Mughal era), old folks shooting the breeze and young studs exchanging stealthy looks with girls several buildings away.

Yes, and in style. Haveli Dharampura has a rooftop restaurant (currently closed because of the sweltering weather) and one by the courtyard, which is plainly furnished but benefits from being so close to the action. The portions are generous and the food - a combination of the delicately spiced vegetarian dishes eaten by the Hindu and Jain traders in Old Delhi and the rich Mughlai dishes for which the area is famous - is excellent and reasonably priced.

At weekends, a classical Kathak dancer accompanied by musicians performs on the courtyard balcony, filling the haveli with the sound and ambience cultured nawabs once enjoyed in the evenings, after a hard day of being pleasant in the royal court.

No wine! Yet. An alcohol licence has been applied for and it can't come soon enough; tearing off a piece of buttery, crispy naan and dipping it into the rich aromatic korma without a glass of merlot is a crime.

Rooms range from 8,000 Indian rupees (HK$933) to 12,500, depending on size and whether there is a balcony. A suite - there are six - costs 18,000 rupees.