The Madras High Court on Tuesday modified an order passed by it on March 26 directing the Adyar Gate Hotels to pay ₹10 crore to the Greater Chennai Corporation in three instalments. The court permitted the hotel to deposit ₹5 crore and provide bank guarantee for an equal sum since it claimed to be suffering from low occupancy due to shifting of the Indian Premier League (IPL) venue from Chennai to Pune.
Justice M. Duraiswamy modified the order after a special mention made by senior counsel R. Gandhi on behalf of the hotel chain. The counsel stated that the hotel had paid the first instalment of ₹3 crore on time and could not deposit the rest of the ₹7 crore since its plans to fill about 150 rooms during the IPL season got foiled due to the shift in the venue at the last moment because of protests over the Cauvery water sharing issue.
The judge directed the hotel management to pay ₹2 crore by May 15 and provide a bank guarantee for the rest of the ₹5 crore. Making it clear that no further modifications would be permitted, he said that an interim injunction granted by the court on March 26 restraining the Corporation from taking coercive action against the hotel management would stand vacated automatically if the deadline fixed by the court for payment of money was not adhered to.
The orders were passed on a writ petition filed by Adyar Gate Hotels challenging the demand for property tax to the tune of ₹24.88 crore by the Corporation. Opposing the plea for modification, Additional Advocate General Narmadha Sampath contended that the court should not show any kind of indulgence to the hotel management since what was due was public money meant for purposes such as running Amma canteens, managing schools and laying roads.
The AAG said the corporation would not benefit by accepting bank guarantees and that the writ petitioner should, in fact, be ordered to pay the entire demand of ₹24.88 crore. “I can’t be running the corporation on bank guarantees. They have not made out any case for modification. They have not shut down their business. They are still running their business. They can pay. If I am asked to run the corporation on bank guarantees, I’ll be doing injustice to the people,” she argued.
However, when the judge wanted to know from when the property tax was due, she said, it was due since 2010-11. “What was the Corporation doing all these years?” the judge questioned and the AAG replied that it had been following up the issue since then and had issued many notices to the hotel management.
