Taj Mansingh auction: NDMC to reply to MHA notice by Aug end

The New Delhi Municipal Council today said it will reply later this month to the show cause notice issued by the Home Ministry querying it on the "delay" in auction of five star hotel Taj Mansingh here in posh Lutyens Bungalow Zone.
"We will finalise our response to the show cause notice in its next meeting of the council which will be held by end of the month," a senior NDMC official said.
The Home Ministry, which is the administrative ministry of the civic body, had issued a notice to NDMC asking why it has been delaying the auctioning of the Taj Mansingh hotel for the last two years.

Tata's Indian Hotels Company Ltd (IHCL) had entered into a 33-year lease agreement with NDMC for using the Taj Mansingh Hotel property in 1978, which ended in October 2011.
In September last year, the municipal body had decided to give one-year extension to the Tatas besides giving the first right of refusal in an auction to be conducted within one year.
Sources said the Home Ministry was concerned that the "provision of the first right of refusal will result in a lower bid in the public auction."

Following this, IHCL had approached the High Court in April to get a stay on the auction of its property.

The Delhi High Court had asked Tatas to approach the court if any coercive steps are taken against it by the NDMC.
Though the land belongs to NDMC, IHCL has invested in the construction of the hotel's building.
Officials said the NDMC had then decided to seek legal opinion from Solicitor General on the auction process.
The Urban Development Ministry had also earlier suggested that NDMC should go for open bidding for the property but after the IHCL approached the court, the ministry asked the body to follow the legal course.
"The council is waiting for the opinion of the Solicitor General. This matter is now caught up in bureaucratic juggernaut. Both the Home Ministry and Urban Development Ministry have contrasting views on the issue," they said.

"The Urban Development Ministry wants us to take the legal process whereas the Home Ministry wants us to speed up the auction," the NDMC officials said, adding, the council will take cognisance of the matter in the next meeting which will take place towards the end of the month.
Acording to reports, the Home Minsitry had asked NDMC to reply to show cause notice by August 6. But NDMC officials said they still have "some time" to respond to it.