In a setback to the Mayawati government in Uttar Pradesh,the Supreme Court on Tuesday overturned the states decision to cancel land allotment to 14 leading hoteliers including ITC and Indian Hotels. The plots in Noida were allotted in 2006 during the tenure of Mulayam Singh Yadav to build hotels for international visitors to the 2010 New Delhi Commonwealth Games. However,the Bench headed by Justice RV Raveendran conceded the UP governments contention that the allotments were below market prices,causing a loss of R8,000 crore to the exchequer. The court ordered the hotel companies to pay an extra R70,000 per sq m as additional lease premium. The companies must pay 25% of this amount by September 30 and the rest in six monthly instalments. Each company will have to pay roughly R208 crore more to the state government if it wants to keep the plot. If the companies prefer to surrender the plots rather than pay extra,the state government will refund their deposits with 18% interest. However,if the refunds are made before January 11,2012,then the interest rate will be 11%. The hoteliers had earlier challenged the cancellation before the Allahabad High Court,contending that the Mayawati government had taken a unilateral and politically biased decision without going into the merits of allotment. The HC had subsequently suspended the Mayawati governments decision and asked it to examine the matter afresh after hearing the hoteliers. The hoteliers then moved the apex court as they felt it would be futile to go back to the state government to present their case as the hearing in such a matter would be illusory. When contacted an ITC spokesperson said,We have just come to know about the judgment through the media and so will not be able to comment.
