Bombay High Court quashes sale of Park Hyatt Goa to ITC by IFCI

GOARG_P220Blue Coast Hotels Ltd, the owner of the property of Park Hyatt Goa Resort & Spa said the Bombay High Court has quashed the recent auction of the hotel by IFCI.

“By Order dated March 23, 2016 uploaded on April 4, 2016, the Hon’ble High Court of Bombay has quashed and set aside the Order of the DRAT and Order of the (DM – South Goa) and it has also cancelled the sale certificates issued to the Auction Purchaser by the Secured Lender in respect of Hotel Property “Park Hyatt Goa Resort & Spa” under SARFAESI Act 2002,” the company said.

The hotel was won by ITC Hotels, India’s second largest hotel chain, in February after it bid Rs 550 cr.

The luxury hotel, which is just 15 minutes drive from the airport, is a beach property spread over an area of 45 acres and has 250 rooms.

Blue Coast Hotels had protested the sale, claiming that the actual value of the property was around Rs 1,250 cr.

The property was given as collateral security to IFCI to take a loan, which was used by Blue Coast to build a 450 room MGM Grand luxury hotel in New Delhi, the construction of which is expected to be completed by April 2018.

ITC Hotels is already supposed to have paid over Rs 100 cr immediately after the auction for the hotel.

“The Hon’ble High Court of Bombay has also allowed the Company continue to retain physical possession of the property and has entitled the Auction Purchaser to get the refund of the amounts,” Blue Coast said.

Blue Coast has alleged that the loan amount was recalled prematurely by IFCI. Blue Coast has also alleged that IFCI did not submit a copy of the valuation report of the Goa property.

Blue Coast had filed a Writ Petition on October 4, 2014 before the Hon’ble High Court of Bombay seeking the quashing of the Order of the Debt Recovery Appellate Tribunal (DRAT) pending which the Secured Lender had allegedly auctioned the Hotel Property “Park Hyatt Goa Resort & Spa” on February 23, 2015.

The Company had filed a second Writ Petition on March 3, 2015 against the Order dated 26.02.2015 of District Magistrate South Goa(DM – South Goa) which had allowed the takeover of the possession of the Hotel Property “Park Hyatt Goa Resort & Spa” by the Secured Lender.

The Company had also filed a third Writ Petition on March 19, 2015 challenging the auction of the hotel property and issuance of the sale certificates by IFCI — a state-owned enterprise — to ITC Hotels.