The property, owned by NDMC, was given to IHCL on a lease for 33 years, which had ended in 2011.
Delhi High Court today directed New Delhi Municipal Council not to any take "precipitative action" against the iconic Taj Mansingh Hotel while allowing Indian Hotels Company Ltd (IHCL), which runs the luxury property, to "strengthen" its appeal against a single judge order.
The high court also chided IHCL for their "urgency" in appealing against the single judge order, saying India was "not a banana republic" and the NDMC would not have seized a functioning hotel.
On Monday, the single judge had dismissed the suit by the current operator, Tata group's IHCL, to renew its licence and upheld NDMC's decision to go for auction.
Subsequently, IHCL filed an appeal before the division bench against the order of the single judge.
During a brief hearing on the appeal, a bench of justices Pradeep Nandrajog and Pratibha Rani observed "what was the great urgency" to file an appeal having "half baked grounds."
"Don't show anxiety. They (authorities concerned) are not going to come as of now. Heavens are not going to fall if you would have waited for some more time.
Take your time and first try to digest the judgement of the single judge. It is a running hotel. Can they (NDMC) come and seize it? Has the country become a banana republic," the bench observed orally.
"We expect your (IHCL) people to strengthen it. By Friday you give your crystallised grounds. They will have to go to you and give you notice before any action is taken. They are not going to do it overnight. The estate officer and the NDMC people are here, nothing will happen. They are reasonable people," the court said.
"You (NDMC) are not going to take any precipitative action," the bench told the counsel for NDMC, to which they agreed. The court fixed the matter for further hearing on September 15.
The property, owned by NDMC, was given to IHCL on a lease for 33 years, which had ended in 2011. The company was given nine temporary extensions since then on various grounds with three of them being in the last year itself.
NDMC had in January this year said it was in the process of assessing the assets of the hotel in preparation for its much-delayed auction.
IHCL had approached the high court seeking a decree of permanent injunction restraining the NDMC from interfering in any manner with the possession, right to operate, run and maintain the hotel at the prime location in Lutyen's Delhi.
IHCL had sought a direction restraining the NDMC from conducting an auction to running the hotel.