Today, Jain said that NDMC was interested in auctioning the hotel, but assured the court that IHCL, which had claimed in the High Court that it had invested heavily to make the hotel an iconic brand, would get an opportunity to match the highest offer. Currently, the Tatas have five hotels in Delhi which includes Taj Mansingh, Taj Palace and three Vivanta properties -Ambassador, Dwarka and Surajkund. The firm then had challenged the verdict in the Supreme Court.
Clearing the decks for the New Delhi Municipal Corporation (NDMC) to e-auction the five-star property, now being run by Tata Group firm Indian Hotels Company (IHCL), a Bench comprising Justices PC Ghose and RF Nariman, however, asked the civic body to grant a "breathing time" of six months to the company to vacate the premises, if it fails to make it to the auction cut. In October previous year, the Delhi High Court had dismissed a plea by IHCL, which challenged an earlier verdict allowing the auction of the hotel. NDMC wanted to conduct auctions but by providing the right of first refusal (RoFR) to IHCL.
The Tata Group had been given a 33-year-lease for the property and the contract ended in 2011.
The decision was taken by the bench comprising of Justices P C Ghose and R F Nariman that allowed the plea of New Delhi Municipal Council (NDMC) which stated that Tata Group firm can not have the right to refusal in the auctioning of the hotel.
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The bench, however, asked the civic body to grant six months "breathing time" to the company in vacating the hotel in case they lose out in the e-auction. The Group's hotel division was given nine extensions after that.
IHCL had moved the Delhi high court first in April 2013, seeking to restrain the NDMC from auctioning the hotel after a committee declined to renew the licence in its favour for 30 years (See: Centre nulls move to give Tatas priority in Delhi's Taj Mansingh auction). Instead of renewing the lease, the civic body made a decision to opt for a public auction as it would maximise the annual licence fee.
However, the court refused to buy Tata's argument and said that NDMC was within its power to go for an auction.
The high court bench had upheld an earlier September ruling by a single judge bench dismissing Indian Hotels' plea for renewal of its licence to run the hotel.