The union home ministry has said that the Tatas should not be allowed the right of first refusal in the upcoming auction of the Indian Hotels Company-operated Taj Mansingh hotel, opposing the proposal of the New Delhi Municipal Council, which owns the building that houses the luxury hotel in central Delhi.
In a letter to NDMC on May 10, the home ministry said "that the proposal to allow IHCL to have the 'first right of refusal' in the public auction has not been provided for in the lease deed. A provision of 'first right of refusal' will result in lower bids in the public auction.
Therefore, the ministry of home affairs is of the opinion that 'first right of refusal' should not be allowed to IHCL in the proposed auction and fresh lease should be granted by open public auction." ET has reviewed a copy of the letter.
The home ministry's views are important since it is the administrative ministry for the municipal body, which has to find a new operator for the hotel by October this year.
Following the development, the civic body has decided to seek the opinion of the Solicitor General of India. "We will seek his opinion through the ministry of home affairs and the urban development ministry, on how to move forward with respect to the lease, considering there are cases pending in the Delhi High Court and Supreme Court," the spokesman for NDMC, AK Mishra, said.