New Delhi, February 4: The Supreme Court has conducted a hearing regarding the auction of the Hyatt Regency Hotel in Delhi. This case stems from a public interest petition filed by the non-governmental organization Infrastructure Watchdog.
Senior lawyer Prashant Bhushan, representing the petitioner, raised concerns about the misuse of the Insolvency and Bankruptcy Code (IBC) process.
During the hearing, the bench led by the Chief Justice of India questioned the apparent double standards in valuation practices. Chief Justice D.Y. Chandrachud remarked that when a poor woman attempts to sell her home, banks often undervalue it at ₹4 million. However, the valuation rules seem to change when it comes to a five-star hotel. “What is happening here?” he asked.
The court expressed concern over how valuations are determined in such cases.
The Supreme Court has requested the central government to provide complete details regarding the valuation and IBC process related to Asian Hotels Group (Hyatt Regency Delhi). The court inquired how the hotel’s valuation was conducted after negligence in loan repayments.
The Chief Justice further stated that if a debtor can repay the bank to save their property, they should be given that opportunity. However, transparency in the valuation process is essential. The court raised alarms about the inconsistent approaches taken in various cases.
Notices have been issued to Bank of Maharashtra, Punjab National Bank, and Asian Hotels, directing them to submit responses. The petition alleges that, in collusion with bank officials, the hotel’s valuation was deliberately lowered to facilitate large loan waivers and defraud public funds.
This case is significant for the protection of public money and the transparency of the IBC process. The Supreme Court emphasized that no double standards should be applied in such procedures. The decision will be based on the responses from the government and banks in the upcoming hearings. This marks a crucial step towards ensuring accountability in corporate loan waivers and asset auctions.