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Informist, Wednesday, Apr. 22, 2026

 

NEW DELHI – The Delhi High Court Wednesday upheld the New Delhi Municipal Council's decision to terminate the license agreement with Bharat Hotels and asked it to hand over the land where The LaLit hotel is situated to the civic body within 90 days. The court also asked Bharat Hotels to pay INR 10.64 billion to the New Delhi Municipal Council as the license fee for the period from March 2014.

 

The high court said that Bharat Hotels has rightly been found to be in fundamental breach of the clauses of the licence deed signed between the parties in 1982 and therefore, the licence has been terminated by the civic body. Land in New Delhi is one of the scarcest natural resources and if any transaction in respect of such land results in huge losses to the New Delhi Municipal Council, the burden is transferred to the taxpayers, who are the residents of New Delhi, the court said.

 

In 1982, the New Delhi Municipal Council signed a license deed with Bharat Hotels for the construction and commissioning of a five-star hotel and two commercial towers. The license fee of INR 14.50 million per annum was to be paid by Bharat Hotels to the civic body. The license period was 99 years, starting in 1981.

 

The New Delhi Municipal Council later increased the license fee to INR 980 million per annum for the remainder of the license term from Mar. 11, 2014, based on a report by SBI Capital Markets Ltd. The New Delhi Municipal Council issued a demand notice to Bharat Hotels to pay INR 10.64 billion, which comprised arrears of license fee at the enhanced rate, along with interest, and arrears of outstanding license fee with interest. 

 

The New Delhi Municipal Council had said that the nominees of the sub-licensee of Bharat Hotels had executed four documents in 2016 in favour of the Indian Wind Power Association for shop and office spaces, which were agreements of sale, purchase, and transfer. This was in clear breach of the clause of the license deed between the parties, the New Delhi Municipal Council said. Bharat Hotels was aware of this sale, purchase, and transfer agreement, it said. In terms of the license agreement, Bharat Hotels had only been granted the right to create a sub-license with the prior consent of the municipal council, and it could not, in any case, have sold or transferred the subject property, the New Delhi Municipal Council said.  End

 

Reported by Surya Tripathi

Edited by Saji George Titus

 

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