Party president Rajnath Singh made the announcement at press conference and said the decision was unanimous and that Goel also consented to it. Singh was flanked by several senior leaders including veteran L K Advani, senior leaders Sushma Swaraj, Arun Jaitley, Ananth Kumar and Delhi election in-charge Nitin Gadkari.
Goel and Vardhan were also both present at the press conference.
All members of the parliamentary board were in the meeting except Narendra Modi who has given his consent to the decision, party sources said.
The party expects that by presenting Vardhan, a former health minister who has a clean image, as the chief ministerial candidate it will be able to put up a tough fight to dethrone the Congress dispensation, which has been in power for the last 15 years.
The decision by the party has come despite stiff opposition to Vardhan's candidature by Goel. The internal squabbles in the Delhi BJP over the issue had threatened to take its toll on the party's campaign.
A number of Delhi BJP leaders last week had conveyed to the party's central leadership that they should announce the candidature of Vardhan, arguing that he has wider acceptability among people, party leaders and workers.
BJP set to name Harshavardhan candidate for Delhi CM's post
BJP's Goel threatens to resign if not named Delhi CM candidate
Congress vs BJP vs AAP: The battle for Delhi begins
Delhi polls: Vijay Goel's self assertion miffs many in BJP
Delhi 'way ahead' of Gujarat; BJP misleading people: Dikshit