Tata group retains right to operate iconic Mansingh hotel for 33 years
NEW DELHI: The Tata group’s Indian Hotels Company Limited (IHCL) will continue to run Mansingh hotel in central Delhi.
The Tata group on Friday obtained a 33-year lease of the property in an e-auction held on Friday by the New Delhi Municipal Council (NDMC).
The NDMC had been trying to auction the Mansingh hotel, which is owned by the civic body and popularly known as Taj Mansingh, since 2011 when its lease expired. The IHCL, which was operating the hotel till 2011, has since been given nine temporary extensions by the civic body.
Two bidders, existing operator IHCL and ITC Group of Hotels participated in the e-auction, which started at 11am on Friday and closed at 4.01pm.
“The IHCL (Tata Group) was declared as the highest successful bidder and it has retained the lease of the property at a licence fee of ₹7.03 crore per month, including GST. The new lease will be for a period of 33 years. Earlier, they were paying ₹3.94 crore per month as licence fee,” a senior NDMC official, managing the auction process, said.
The NDMC officials said that the civic body will benefit from the new lease. “The new lease has helped NDMC in getting 78% profit as the company will now be paying almost double of what they were paying earlier,” said an NDMC official, on condition of anonymity.
Officials said the licence to manage the property was earlier given to the Tata group in 1978 on a lease for 33 years which expired in 2011.
However, the NDMC could not auction the property then as it was engaged in a legal battle with the IHCL.
IHCL had moved Delhi high court in April 2013, seeking to restrain the NDMC from auctioning Taj Mansingh hotel after a committee declined to renew the licence in its favour for 30 years.
IHCL had said the original licence agreement— with the NDMC as the licensor and IHCL as the licencee—later became a joint venture with two partners.
Earlier attempts of auctioning the luxury hotel had not yielded desired results; so, this time, the NDMC had decided to relax the eligibility criteria for bidders and reduce the minimum number of bids required, an official said.
The e-auction was screened live at Palika Kendra mega LED screen and at major locations of Connaught Place for ensuring transparency and fairness.
Puneet Chhatwal, managing director and CEO, IHCL, in a statement said, “We are delighted that the iconic Taj Mahal will continue to remain a part of the IHCL family. We look forward to investing in the hotel and taking it to new heights of Indian hospitality. The Taj legend will continue to serve Delhi with elegance and charm.”