Tata group can run the Taj Mahal Hotel provided they pay its market rate
Tata Group’s Indian Hotels Company (IHCL) can continue to run the Taj Mahal hotel located on Mansingh Road in Delhi by extension of the lease agreement if it pays the market rate after consultation with the New Delhi Municipal Council (NDMC), Attorney General Mukul Rohtagi has said in his legal opinion to the municipal body.
Endorsing former Solicitor General Mohan Parasaran’s opinion, he has stated that extension by mutual consent is the best option since the other two options — pure public auction or bids by giving IHCL the right of first refusal (RoFR), suffer from limitations which would not yield the right market price.
He has also suggested that NDMC should ascertain the market rates, if necessary, with the help of reputed financial experts other than E&Y to safeguard NDMC’s interests by maximising revenue share. According to him, However, the AG said that auction with RoFR is not advisable as other serious bidders would then refrain from participating in the bidding process.
The decision taken by the New Delhi court although has said that the hotel can be run by Tata group if they pay the market rate of the hotel.
Source: The Financial Express
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