The hospitality reign of two landmark Delhi hotels looks set to end soon with the New Delhi Municipal Council (NDMC) on Thursday confirming a decision to auction Taj Mansingh and cancelling Le Meridien's licence.
The two decisions were pending since long as the civic body was entangled in legal battles with the hotel operators. Chief Minister Arvind Kejriwal, a member of the NDMC, made the announcement following a special meeting.
"Important decisions today's NDMC meeting- open auction of Taj Mansingh, cancel Le Meridien Hotel license...," he tweeted.
While the IHCL spokesman refused to comment on the development as "the matter is sub judice", the Le Meridian spokesperson said, "We have not received any official communication from NDMC yet. The case is subjudice and all hotel operations continue uninterrupted."
HERE IS ALL YOU NEED TO KNOW
- Taj Mansingh, owned by the NDMC, was given to the Tata Group's Indian Hotels Company Limited on lease for 33 years. The lease expired in 2011 and the company was given nine temporary extensions.
- The civic agency, under the administrative control of the Union home ministry, had got the nod to auction the hotel in March 2015. It had also selected SBI Cap, to be its transaction consultant for the auction. However, the process got delayed with the Tatas moving court.
- The Supreme Court in January asked NDMC to reconsider the decision to auction the property. According to minutes of Thursday's meeting, "the best available method to NDMC... to obtain the fair market value of rental of the said property in a fair and transparent manner is to opt for e-auction of the premises."
- A senior NDMC official said the right to first refusal to the Tatas has been denied in this auction, which means the company can't take part in the process. "The right of first refusal to the Tatas will not be in public interest and would not yield a correct and fair price. The Supreme Court will be apprised of the decision accordingly," he said.
- The civic body also decided to cancel the licence of Le Meridien. "The council decided that the licence of the hotel be terminated due to non-payment of fee worth Rs 526 crore and the Delhi High Court will be apprised accordingly, keeping in view the gross abuse of the process of law by the hotel," the NDMC official said.
- In the Le Meridien's licence case, allegations of irregularities have been levelled against the civic body in recovery of the amount.