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SC asks NDMC to reconsider its decision to auction Hotel Taj Mansingh

The Supreme Court on Thursday asked the New Delhi Municipal Council (NDMC) to reconsider its decision of auctioning the iconic Taj Mansingh Hotel in wake of the Attorney General and Solicitor General’s opinion not to initiate any such process.

The apex court noted the fact that the opinions of both the top law officers against the auctioning of the hotel was not placed before the Ministry of Home Affairs for consideration.

A bench of Justices Pinaki Ghose and R F Nariman also took note of the fact that there was also an internal opinion of the top office bearers of NDMC against the auctioning process.

“At this stage, we direct NDMC to reconsider its decision in view of its own internal opinion and the opinions of the Attorney General and Solicitor General. The report should be filed within six weeks,” the bench said.

During the hearing, the bench said that “the Attorney General and Solicitor General’s opinion was not looked upon by MHA. You (NDMC) have not placed the opinions before the ministry concerned. We do not know what the ministry would have said if the opinions were placed before it”. It told Additional Solicitor General Sanjay Jain that NDMC has told the ministry that opinions of the AG and SG which have favoured extension of lease, are still awaited.

“It is strange and doesn’t look bonafide. The AG and SG’s opinions should have been placed before the ministry concerned,” the bench said. It asked Jain whether NDMC agrees to reconsider the decision of going ahead with the auctioning process. To this, the ASG said, “No, it can’t be done.” “Why are you not agreeing to reconsider the decision. It not a matter of right. Do you not want to be fair to the party who has been paying the rent constinously for 30 years,” the bench said.

The Tata’s Indian Hotels Company Ltd (IHCL), which has challenged a Delhi High Court order allowing NDMC to auction the hotel here, had earlier told the apex court that it was “not clear” why NDMC wanted to auction the prime property which gave the “best revenue” to it.

The company had earlier submitted that NDMC expert report suggests that the council would “lose revenue” if the hotel was auctioned to other players. The apex court had on November 21 last year directed that status quo be maintained with regard to NDMC’s auctioning process of Taj Mansingh Hotel.

It had also refused NDMC’s prayer that the hotel should be restrained from taking any fresh bookings, saying, “It is very difficult to restrain fresh bookings for a running hotel.

Everything will be decided when we hear the matter.” IHCL, which runs the five-star hotel in the national capital, had on November 8 last year approached the apex court against the Delhi High Court’s order that cleared the decks for auctioning of the iconic property.

The firm had challenged the October 27 last year verdict delivered by a division bench of the high court which had dismissed IHCL’s petition challenging the move by NDMC to auction the property. The high court had dismissed IHCL’s plea saying the company has “no right” for renewal of the licence period and NDMC was “within its power” to secure maximum consideration for grant of licence for the property located at the prime location of 1, Man Singh Road in Lutyen’s Delhi.

IHCL had moved the division bench of the high court against the September 5 last year judgement of a single judge who had not acceded to the firm’s request for renewal of licence for a further period, saying it was not entitled for the extension.

The property, owned by NDMC, was given to IHCL on a lease of 33 years. The lease had ended in 2011 and the company was given nine temporary extensions since then on various grounds, with three of them granted last year itself. NDMC had earlier said it was in the process of assessing the assets of the hotel in preparation for the much-delayed auction. IHCL had earlier approached the single judge bench of the high court seeking a decree of permanent injunction restraining NDMC from interfering in any manner with the possession, right to operate, run and maintain the hotel premises.