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The New Delhi Municipal Council (NDMC) may, the Union home ministry has agreed, seek the Union solicitor-general (SG)’s opinion on whether Indian Hotels Company Ltd (IHCL) should get a “first right of refusal” in the auction of the five-star Hotel Taj Mahal.
The Union home ministry is the parent one for the national capital’s administration. IHCL runs the Taj group of hotels, which in 1968 had signed a 33-year lease agreement for the property in the heart of Delhi. The place is popularly known as the Taj Mansingh, after the road it is located on.
Since the SG’s view on the matter is awaited, the council at its meeting on Wednesday deferred any discussion on the auction process. “I would not like to call a meeting on this matter till I have the SG’s opinion exactly as the council desires me to,” said Jalaj Shrivastava, chairman, NDMC.
The home ministry had earlier issued a notice to NDMC for not auctioning the property even two years after the lease with IHCL had expired. It also scolded the municipal body for referring the matter to the SG without consulting it. The ministry had also raised concern that the “provision of the first right of refusal will result in a lower bid in the public auction”.
The lease for the property expired in October 2011 and was extended for a year. IHCL had approached the high court this April to get a stay on the auction. The court will hear the matter only on November 7. The HC wouldn’t give a stay order but did give an assurance that if NDMC coerced it into vacating the premises, the company could take legal recourse. After the 2011 extension ended in October 2012, the company expected yet another. However, NDMC decided to go ahead with an auction within a year.
The Union home ministry is the parent one for the national capital’s administration. IHCL runs the Taj group of hotels, which in 1968 had signed a 33-year lease agreement for the property in the heart of Delhi. The place is popularly known as the Taj Mansingh, after the road it is located on.
Since the SG’s view on the matter is awaited, the council at its meeting on Wednesday deferred any discussion on the auction process. “I would not like to call a meeting on this matter till I have the SG’s opinion exactly as the council desires me to,” said Jalaj Shrivastava, chairman, NDMC.
The home ministry had earlier issued a notice to NDMC for not auctioning the property even two years after the lease with IHCL had expired. It also scolded the municipal body for referring the matter to the SG without consulting it. The ministry had also raised concern that the “provision of the first right of refusal will result in a lower bid in the public auction”.
The lease for the property expired in October 2011 and was extended for a year. IHCL had approached the high court this April to get a stay on the auction. The court will hear the matter only on November 7. The HC wouldn’t give a stay order but did give an assurance that if NDMC coerced it into vacating the premises, the company could take legal recourse. After the 2011 extension ended in October 2012, the company expected yet another. However, NDMC decided to go ahead with an auction within a year.
NDMC had sought more time to reply to the show cause notice, it is also awaiting further instructions from the home ministry on whether to go ahead with the auction as planned or wait for SG’s reply and act accordingly.
Section 396 of the NDMC Act, gives the power to the central government to enforce its direction if within a fixed period its instructions given under section 395, are not followed.
