The encounter took place near Lado Sarai's Children's Park at 6 pm, they said.
Dalal was wanted in a case of firing at a popular Pishori restaurant in Lajpat Nagar. Two persons were seriously injured in the firing which took place on March 3, Deputy Commissioner of Police (Special Cell) P S Kushwah said.
Previously, Dalal was involved in nine criminal cases, including those of extortion and attempt to murder, in Delhi and UP, he said.
In 2017, Dalal, along with his associates had demanded Rs 1 crore from a doctor based in Uttar Pradesh's Deoband at the behest of Amit Bhura. When the doctor refused to pay, they opened fire at him, the police said.
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