Published: Sat, April 22, 2017
Finance | By Laverne Griffith

SC allows NDMC to E- auction Taj Mansingh Hotel

SC allows NDMC to E- auction Taj Mansingh Hotel

The apex court has allowed the civic agency to e-auction the five-star hotel, now being run by Tata Group firm Indian Hotels Company Ltd (IHCL).

In a major blow to the Tata Group, the Supreme Court on Thursday allowed the New Delhi Municipal Corporation (NDMC) to auction the capital's iconic Taj Mansingh Hotel.

IHCL had reportedly responded that it was not clear why NDMC wanted to auction the property as it was giving the best possible revenue. IHCL, which runs the Taj Mansingh Hotel in the national capital, had on November 8 previous year approached the apex court against the Delhi High Court order which had paved the way for auctioning of the iconic property.

The Indian Hotel Company (IHCL), which manages the property popularly known as Taj Mansingh, will take part in the e-auction.

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The bench, however, had asked the civic body to grant a six-month "breathing time" to the company in vacating the hotel in case they lose out in the e-auction.

On March 3, the NMDC had informed the bench that it wanted to e-auction the hotel. "Therefore, the ministry of home affairs is of the opinion that "first right of refusal" should not be allowed to IHCL in the proposed auction and fresh lease should be granted by open public auction". The official further said that IHCL will participate in the auction as and when it is scheduled. The company then moved the Supreme Court against the high court ruling in November. "IHCL will be allowed to participate in the bid and also match the highest offer, " additional solicitor general Sanjay Jain told the court today. The municipal body had entered into an agreement with the IHCL, a subsidiary of Tata Sons, in December 1976 to construct and run the 11-storey hotel. After the lease ended, the IHCL was given nine temporary extensions to keep the Taj Mansingh hotel. The council had earlier put an end to legal tangles with the previous owner of the Asian Hotel, who was evicted from the property on court orders.

The IHCL had earlier approached the single judge bench of the high court seeking a decree of permanent injunction restraining the NDMC from interfering in any manner with the possession, right to operate, run and maintain the hotel premises.

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