NDMC to discuss ministry concerns on Taj Mansingh bid

Home ministry has asked NDMC to explain delay in auctioning the property

The New Delhi Municipal Council (NDMC) is likely to hold a meeting on Wednesday to discuss the concerns raised by the home ministry on the auction of the Taj Mansingh hotel here.

The ministry had issued a showcause notice to NDMC for not auctioning the property even two years after its lease had expired. The lease expires in October, after its extension and re-extension.

It had raised concerns that the “provision of the first right of refusal would result in a lower bid in the public auction.” The ministry had also pulled up the body for referring the matter to the Solicitor General. Since the decision regarding the auction has not been taken by NDMC alone, but by the entire council comprising the members from urban development ministry, the council would put up the matter for consideration again.

Indian Hotels Company, which operates the Taj Group of hotels, had approached the high court here in April to get a stay on the auction of its Mansingh property. The court would hear the matter on November 7.

Though the company has not secured a stay order from the court, it did get an assurance that if NDMC coerced it from vacating the premises, the company could take a legal recourse.

The company had signed a 33-year lease pact for the property in Lutyens' Delhi; it had expired in October 2011. Subsequently, the hotel was given a year's extension. While the company expected the lease to be renewed in October 2012, NDMC decided to go ahead with an auction within a year. The lease was again extended. NDMC had sought more time to reply to the showcause notice. It is also awaiting further instructions from the home ministry on whether to go ahead with the auction as planned or wait for the Solicitor General’s reply and act.

Section 396 of the NDMC Act gives the power to the Centre to enforce its direction if its instructions given under section 395 are not followed within a fixed period.