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The recent legal battle surrounding Hotel Wildflower Hall in Himachal Pradesh has reached a logical conclusion with the Himachal Pradesh High Court's verdict mandating the East India Hotels (EIH), a part of the Oberoi Group, to relinquish control of the property to the Himachal Pradesh Tourism Development Corporation (HPTDC) within a two-month period. This judicial ruling stemmed from the dismissal of EIH's plea for review against the court's initial order pronounced on November 17, 2023. Presiding over a single bench, Justice Satyen Vaidya stood by the "warrant of possession" filed by HPTDC on December 15, 2023, effectively denying EIH's appeal.
The genesis of this legal tussle dates back to the unfortunate incident of a fire ravaging Hotel Wildflower Hall in 1993. Following this incident, the property, once Lord Kitchener's residence, fell under the management of EIH through a joint venture named 'Mashobra Resorts Limited'. An agreement in 1995 outlined the joint venture's structure, stipulating the Himachal Pradesh government's minimum shareholding at 35% and EIH's at 36%. However, issues between the involved parties escalated, leading the state government to terminate the agreement in 2002, citing purported breaches.
The ensuing conflict escalated further, prompting the appointment of a retired Supreme Court judge, RP Sethi, as the arbitrator in this dispute. Sethi's assessment upheld the legality of the joint venture agreement and recommended a mutually agreed separation as the only viable resolution due to the irreparable damage sustained in the relationship between the disputing parties. EIH's legal recourse challenging the arbitrator's decision faced rejection by the High Court in October 2022.
Initially, EIH was entrusted with the responsibility of constructing and operating Hotel Wildflower Hall. However, the state government retained the prerogative to terminate the agreement if commercial operations failed to commence within four years of acquiring the land.
The recent judicial pronouncement signifies a significant turning point in this long-drawn legal battle, as it stops EIH from retaining control and orders the transfer of Hotel Wildflower Hall to HPTDC. This ruling acknowledges the contractual nuances and the complexities of the joint venture agreement, emphasizing the court's commitment to upholding legal integrity. It effectively concludes the legal issue between the involved entities.
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