A top government functionary said the Home Ministry will wait for a report from the Delhi Lieutenant Governor Najeeb Jung on his efforts on exploring the possibility of government in Delhi.
"If no government formation takes place, we will have no option but to hold elections. We will take a quick decision according to the suggestion of the Lt Governor," the government functionary said.
The NDA government nor the BJP was interested in doing anything "undemocratic" that will bring "disrepute" to the party as well as the government ahead of the Assembly elections in Jammu and Kashmir and Jharkhand, he said.
By-elections for three assembly seats in Delhi are also to be held next month.
The Centre, yesterday, told the Supreme Court that the President has given his consent to the Lt Governor's proposal to invite BJP to form government.
Rapping the Centre and the LG over the delay, the apex court said that in a democracy President's Rule cannot go on forever and questioned why the authorities failed to act expeditiously.
At present, BJP and ally Akali Dal with one MLA, account for 29 legislators and will require the support of five more MLAs to prove majority in a House of 67 if it decides to form the government.
The party is hoping of getting the support of expelled AAP MLA Vinod Kumar Binny and Independent MLA from Mundka Ramvir Shokeen.
The total strength of the Delhi Assembly is 70 and the three vacancies it has to be filled in by-elections late next month. AAP had formed the government in Delhi with the support of Congress.
The government led by Arvind Kejriwal had resigned on February 14 after the party's pet project, Janlokpal Bill, could not be passed due to opposition from BJP and Congress.
President's Rule was imposed in Delhi on February 17. Jung had not favoured dissolution of the Delhi Assembly as recommended by the council of ministers headed by Kejriwal and kept the Assembly in suspended animation.