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Informist, Tuesday, Apr. 7, 2026

 

NEW DELHI – New Delhi Municipal Council Tuesday urged the Delhi High Court to reject Indian Hotels Co. Ltd.'s plea seeking exemption from paying INR 462 million in monthly licence fees for the period between 2020 and 2022. Indian Hotels had said it was unable to run the Taj Mahal and The Connaught hotels in the national capital during that period on account of the COVID-19 pandemic and restrictions to curb pollution. The high court sought Indian Hotels' response on the civic body's application for rejection of the company's suit and listed the case for hearing in July.

 

Indian Hotels' suit was "ex-facie barred by limitation" and was liable to be rejected at the very threshold as it was filed in 2026 for a cause of action that accrued in April 2020, said the civic body. The maximum permissible outer limit for instituting the present suit would have expired by May 2025, said the civic body.

 

New Delhi Municipal Council said Indian Hotels' suit was expressly barred by Section 15 of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, and the high court lacked the subject-matter jurisdiction to entertain the same. By instituting the present suit disguised as a benign suit for a declaration, Indian Hotels is attempting a gross abuse of process to bypass, pre-empt, and derail the exclusive statutory mechanism and the jurisdiction of the estate officer under the Public Premises Act, said the municipal council.

 

Indian Hotels had entered into an agreement with the New Delhi Municipal Council to operate, maintain, and manage the two hotels owned by the civic body. Under the force majeure clause in the agreement, a party would be excused from performing its obligations in exceptional circumstances, including an epidemic and extremely adverse weather.

 

As a direct consequence of the pandemic and the restrictions imposed on the movement of people and goods and the conduct of business, Indian Hotels said it was prevented from performing its obligations under the agreement. At various junctures, the two hotels remained closed. Even when they were opened, they functioned under several restrictions imposed by the government, affecting normal operations and, consequently, revenues. Further, guests did not visit or stay at the hotels at the time. The hotels were also directed by the state to be used by Sir Ganga Ram Hospital, New Delhi, to accommodate COVID-19 patients, it said.

 

Later, because of restrictions imposed to counter severe pollution in the national capital, construction activities were wholly barred or severely restricted, Indian Hotels said. This resulted in halting or considerably slowing work to upgrade the hotels, it said. Various measures implemented by the Commission for Air Quality Management in the National Capital Region to curb pollution resulted in shortage of bookings as well as cancellations, causing a substantial loss, it said. The company argued that this amounted to a force majeure event and therefore, the company be excused from performing its obligation of paying the licence fees.

 

At 1135 IST, shares of Indian Hotels were down marginally at INR 595 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Surya Tripathi

Edited by Vandana Hingorani

 

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