After months of uncertainty, the New Delhi Municipal Council is getting ready to auction the Taj Mansingh hotel and will most likely not allow potential bidders to demolish the 38-year-old structure.
The five-star hotel started operations in 1978 after the Tata Group-owned Indian Hotels Co. Ltd. (IHCL) signed a 33-year lease with the NDMC in 1976. Though the lease expired in 2011, the NDMC granted IHCL nine extensions before the matter went to court. On Thursday, the Delhi High Court paved the way for the auction by dismissing IHCL’s plea. The court observed that the IHCL did not have the right for renewal of licence.
According to several NDMC officials, the process for the auction had never stopped as there was no stay, but would be expedited now. The NDMC had roped in SBI Capital Markets last year to be its transaction advisor for the Taj Mansingh auction. A senior official said the draft of the tender document had been submitted by SBI Cap and the NDMC would deliberate on it after getting a copy of the court order and legal advice.
Another top NDMC official said the “iconic” hotel would be protected, in the sense that there would be “retro-fitting and modernisation” in the interior, but the building would not be demolished.
Earlier in January, the NDMC had held a meeting with potential bidders, both domestic and international hotel companies. According to sources, one of the questions raised was whether the bidder would be allowed to demolish the hotel to make way for a new building. The NDMC official said that the auction would be open to all, including the IHCL and international hotel companies. While the NDMC prepares for the auction, the IHCL will appeal against the High Court order in the Supreme Court.
