SC gives the go-ahead to Taj Mansingh Auction


The Supreme Court, on Thursday, permitted the New Delhi Municipal Council to e-auction the Taj Hotel on Mansingh Road in the capital following the expiry of the licence granted to the Tata group to run the hotel. The civic body had, on March 3, told the SC that it wants to e-auction the hotel.

The IHCL, which runs the Taj Mansingh Hotel, on November 8, 2016, approached the apex court against the Delhi High Court order, which had paved the way for auctioning off the historic property.

A bench of Justices P.C. Ghose and Rohinton Nariman also accepted the plea of the NDMC that the Tata Group can not have the right of refusal in the auctioning of the hotel. It asked NDMC to review its decision as opinions of the top two legal officers of the country - Attorney General and Solicitor General - were not considered while decision to E-auction the property was taken in the meeting in presence of Delhi chief minister Arvind Kejriwal. In October a year ago, the Delhi High Court had dismissed a plea by IHCL, which challenged an earlier verdict allowing the auction of the hotel. The NDMC had served eviction notice to the IHCL to "clear all applicable dues and handover the possession of the said property immediately". "We are evaluating the options", the source said.

Challenging the decision, the Tatas moved the Supreme Court, which, however, rejected their plea. NDMC wanted to conduct auctions but by providing the right of first refusal (RoFR) to IHCL. In January this year, the hotel was e-auctioned at Rs 45.5 lakh per month as licence fee.

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IHCL had on November 8 a year ago approached the apex court against the Delhi High Court's order that cleared the decks for auctioning of the iconic property.

Thursday's development comes after the NDMC, on March 2, unanimously chose to auction the rights of managing the hotel for a higher revenue share for the land which belongs to it.

At that time NDMC and IHCL entered into a pact, under which NDMC was to bear the construction cost of the hotel up to a sum of Rs 4.25 crore and IHCL was to bear the remaining cost. NDMC vice-chairman Karan Singh Tanwar had explained its stance for auctioning the property stating that the council is not bound to give IHCL extension as per contract, and also there was no mention of a right of RoFR to IHCL anywhere in the contract.