Telangana High Court
Maha Hotel Projects Pvt. Ltd. vs State Of Telangana on 20 November, 2025
Author: Nagesh Bheemapaka
Bench: Nagesh Bheemapaka
HON'BLE SRI JUSTICE NAGESH BHEEMAPAKA
WRIT PETITION No. 30461 OF 2025
O R D E R:
This Writ Petition is filed to declare the decision
taken by Empowered Committee (Tourism) of the State of
Telangana in its meeting dated 22.09.2025 as arbitrary and
unconstitutional; and to further declare that the accrued right
of Petitioner cannot be taken by Respondents 1, 2 and 3 without
following procedure established by law and without
compensating for the same and to further declare that such
consent will be in violation of the Consolidated FDI Policy of
India and also to direct Respondents 6 and 7 not to allow FDI in
Golden Jubilee Hotels Private Limited by Respondent No.4 in
violation of the Consolidated FDI Policy of India.
2. The facts of the case are : Petitioner is the lead
developer of consortium to which State of Andhra Pradesh (now
Telangana) awarded project for construction, development and
operation of a 5-Star Hotel at Hyderabad. Respondent No.1 is
the State of Telangana through the Youth Advancement,
Tourism & Culture Department that owns the project and
floated the tender for the execution. Respondent No.2 is
Telangana State Tourism Development Corporation which is a
State Government undertaking and has been nominated by the
State Government to represent Respondent No.1 for legal
purposes. Respondent No.3 is the Empowered Committee
(Tourism) of the State of Telangana comprising of the Deputy
Chief Minister & Minister of Finance, Minister for Tourism &
Culture and Minister for IT, Industries & Commerce, which was
tasked with taking the decision on the representation of
Respondent No.4 for taking over the project. Respondent No.4 is
to whom the project has now been awarded by the State
Government and it was the successful resolution applicant in
the Corporate Insolvency Resolution Process (CIRP) of the
Petitioner's project company. Respondent No.5 is a registered
Society under the State of Telangana which granted additional
land for construction and development of the project.
Respondent No.6 is Reserve Bank of India. Respondent No.7 is
the Department for Promotion of Industry and Internal Trade,
Ministry of Commerce and Industry, Government of India.
2.1. It is further stated that Respondent No.1 floated a
tender for 'Five Star Hotel Project', whereby the successful
bidder was to develop, finance, build, operate and transfer a
Five Star Hotel on land leased by Respondents 1 and 5 against
payment of a monthly lease and development premium. Further
clarifications on the terms of the RFP were provided in pre-bid
meetings. It was clarified in the pre-bid meetings that a separate
Special Purpose Vehicle (SPV) company was needed for
maintenance of separate books of account to arrive at gross
turnover for calculating additional development premium. Thus,
SPV i.e. M/s. Golden Jubilee Hotels Pvt. Ltd. executed Lease
Deed and Development & Management Agreement, both dated
09.05.2007, with Respondent No.1 for construction and
development of the Hotel Project.
2.2. Petitioner further states that leader of consortium
and financially significant member transferred their
shareholding i.e. 84% shareholding to their company, which
was recognized as the Lead Developer of the Project by
Respondent No.1. Remaining 16% shareholding was held by
M/s EIH Ltd., the technical member of the consortium. That
part of the project land belongs to Respondent No.5 with which
a separate lease agreement was entered for the purpose of the
project. It is further stated, on 08.12.2008, Respondent No.1
approved the revised DPR for the project in which it was
mentioned that Petitioner company is the venture company of
My Home Group for this project and that they had mobilized the
required 21 resources for the project. Respondent No.1
Department had also given 'No Objection Certificate' dated
01.10.2009 for creating mortgage on the leasehold right for
availing finance for the project. M/s Golden Jubilee Hotels Pvt.
Ltd thereby availed financial assistance from a consortium of
public sector banks with Bank of Baroda as the leader of the
lending consortium. The project was conceived with two towers,
out of which one was completed in 2013, and a 5-star hotel
under the name Trident, Hyderabad' started commercial
operations in September, 2013. The second tower was also
almost complete with only interior work left to be done. Vide
letter dated 17.09.2013, the State Government sought to
unilaterally increase the lease rate from Rs. 4000/- to Rs.
7500/- per square yard, however this Court under order dated
26.09.2013 in Writ Petition No. 27922 of 2013 granted interim
suspension of the letter dated 17.09.2013 of the State
Government.
2.3. It is also stated, as agreed between the consortium
members, technical member i.e. M/s. EIH Ltd. was appointed as
the operator of the hotel. However, M/s. ElH Ltd. connived with
Bank of Baroda, which provided EIH with 'No Objection
Certificate' to open and operate a separate bank account for
GJHPL i.e. other than the one agreed upon in agreements
between GJHPL and lenders. M/s EIH opened this separate
bank account in Union Bank of India by providing KYC
documents of its own employees and started diverting revenues
from hotel operations into this account. Between October 2015
and July 2016, EIH Ltd. diverted around Rs. 88 Crores which
financially crippled GJHPL. Resultantly, GJHPL was unable to
service its dues to lenders and its account was declared as 'non-
performing asset' by the banks.
2.4. The contention of Petitioners is that Bank of Baroda
filed a Petition under Section 7 of the Insolvency and
Bankruptcy Code, 2016 (IBC) before the National Company Law
Tribunal, Hyderabad Bench which was admitted on 27.02.2018.
In the Corporate Insolvency Resolution Process [CIRP], a
resolution plan by Respondent No.4 was approved on
07.02.2020, wherein Respondent No.4 offered Rs.342 Crores to
the lender banks. Since GJHPL was an SPV company
established solely for executing Five Star Hotel Project of the
State Government, the approved resolution plan contained a
condition that it shall be implemented only if the State
Government's consent is obtained by Respondent No.4 for the
change in shareholding of GJHPL within one year from plan
approval by NCLT.
2.5. Petitioner further contended that Respondent No.4
could not obtain the consent of the State Government within
one year and terminated its resolution plan vide letter dated
21.06.2021. Consequently, it filed 1.A.No.293 of 2021 before the
NCLT for affirmation of termination plan and withdrawal from
proceedings and seeking stay on invocation of bid bonds. An
interim order staying the invocation of bid bonds was granted by
NCLT on 25.06.2021 on the ground that the resolution plan was
terminated by Respondent No.4 due to non-fulfilment of
condition precedent. One of the lender banks i.e. Bank of
Baroda opposingly filed I.A. No. 509 of 2021 praying for specific
performance of the obligations by Respondent No.4 contained in
the Resolution Plan. The Application of Respondent No.4
numbered I.A.No.293 of 2021 was pending consideration and
the 26-Application filed by Committee of Creditors
(CoC)/lenders numbered 1.A.No.509 of 2021 was pending
adjudication. In December 2022, Respondent No.4 and Banks
started reporting that they are trying to reach a settlement
among themselves. In February 2023, Respondent No.1 was
replaced by Respondent No.2 on account of State Government's
decision that the dispute on its behalf will be dealt by
Respondent No.2 in place of Respondent No. 1. In October 2023,
the State Government through Respondent No.2 started
reporting that it is also a part of the settlement talks and is
considering whether or not to give consent on the proposal of
Respondent No.4.
2.6. It is further contended that on 01.07.2025, an order
was passed where NCLT directed the State Government to
report on the status of the approvals being considered by it. On
04.07.2025, this original order dated 01.07.2025 was deleted
from the website of NCLT and a new order dated 01.07.2025
was uploaded whereby it is written that Respondent No.2
requested for six weeks-time for obtaining approvals from the
State Government and the time for the same has been granted
and Respondent No.2 was directed to file detailed status report.
2.7. Petitioner stated that on 25.09.2025, Respondent
No.2 filed a memo before the NCLT along with the impugned
minutes of meeting of the Empowered Committee where the
following decision has been taken:
" Empowered committee has decided to issue a No Objection
Certificate in favour of successful Resolution Applicant i.e., M/s. BREP
Asia II Indian Holding Co. (NQ) Pte., Ltd., (M/s. Blackstone) with the
following terms and conditions:
1) Lease with the M/s. BREP Asia II Indian Holding Co. (NQ)
Pte., Ltd., (M/s Blackstone) will be valid till the balance period of the
earlier lease agreement upto the year 2041 only, without any extension.
2) The company will make upfront payment of Rs. 88.23 crores
within 15 days from the date of agreement, which is principal amount
due from the previous agency i.e., M/s. Golden Jubilee Hotels (P) Ltd.,
(GJHPL) to TGTDC.
3) On 07-04-2019, sole arbitrator has pronounced award in
favour of developer M/s. Golden Jubilee Hotels (P) Ltd., (GJHPL) against
which COP 39/2020 is filed by YAT&C Department. The M/s. Golden
Jubilee Hotels (P) Ltd., (GJHPL) has claimed an amount of Rs. 42.50
crores including interest in this case. M/s. BREP Asia II Indian Holding
Co. (NQ) Pte., Ltd., (M/s Blackstone) shall agree to forego this claim
against Government of Telangana and TGTDC.
4) The Lease Rental to the TGTDC will be calculated at the rate
of Rs. 7,500/- per sq. yards from the date of agreement i.e., May 2007.
5) M/s. BREP Asia II Indian Holding Co. (NQ) Pte., Ltd., (M/5
Blackstone) will take steps to complete tower 2 and make it operational
in 24 months from date of the agreement.
6) Tripartite agreement will be entered between TGTDC, M/s.
BREP Asia II Indian Holding Co. (NQ) Pte., Ltd., (M/s Blackstone) and
current operator i.e., East India Hotels (EIH) to continue to operate
tower 1 and tower 2, till the end of lease period. Separate agreement can
be worked out between M/s BREP Asia II Indian Holding Co. (NQ) Pte.,
Ltd., (M/s Blackstone) and EIH regarding the operations part.
7) All court cases in which M/s. BREP Asia II Indian Holding
Co. (NQ) Pte., Ltd., (M/s Blackstone) has a claim against Government of
Telangana and TGTDC, shall be withdrawn. Likewise, court cases
pertaining to matters settled in this agreement will be withdrawn by the
Government of Telangana.
8) Post NCLT judgement, the escrow account, where surplus
funds are deposited by the operator has accumulated Rs. 240 crores as
on August 2025. TGTDC will file claims before the NCLT for its unsettled
dues i.e., Rs. 69.83 crores which is the Interest on the pending Lease
Rental & Annual Development Premium (ADP)."
2.8. Being aggrieved by the said decision taken by
Empowered Committee (Tourism) in its meeting dated
22.09.2025, the present Writ Petition is filed contending that
100% FDI in developed infrastructure is impermissible and is
against the FDI Policy and fundamental public policy of India,
amongst various other grounds.
3. Sri Suraj Prakash, learned counsel appearing on
behalf of Ms. Vanaparthi Vaishali, learned counsel for Petitioner
vehemently contended that State Government acted arbitrarily
and illegally by transferring the project to Respondent No. 4
without issuing notice, hearing or compensation Petitioner,
thereby violated Articles 14 and 300A of the Constitution. He
further contended that selection of Respondent No.4 is made
without public tender or procurement, through private
negotiations, which is against public policy. Learned counsel
alleges discrimination and violation of Article 14, as the
technical member (EIH Ltd.) was retained in the project even as
the rights of Petitioner being the Lead Member were
extinguished, despite both being part of the successful
consortium. He also objects that 100% FDI is impermissible for
an already developed hotel project as per the Government's FDI
Policy and NCLT-approved resolution plan could not override
valid contractual and statutory protections without explicit
procedure and consent. Petitioner accrued proprietary rights as
Lead Developer were extinguished without following the
procedure established in the project agreements and that there
was neither any breach committed by Petitioner nor any
insolvency of Petitioner company itself.
3.1. Learned counsel further submits that Appeal filed
at NCLAT was dismissed by order dated 11.12.2024 and also
the Appeal filed in Supreme Court against the NCLAT order was
also dismissed by order dated 03.02.2025. The review petition
before the Supreme Court is pending. He relies on the judgment
of the Hon'ble Supreme Court in Embassy Property
Developments Private Limited v. State of Karnataka 1,
judgment of Division Bench of this Court in Anasuya v. V.M.
(2020) 13 SCC 308
Sateesh (Writ Appeal No. 57 of 2025) and the judgment of Uttar
Pradesh High Court in Bishambhar Dayal Chandra Mohan v.
State of Uttar Pradesh.
4. On the other hand, the learned Advocate General
appearing for Respondent No.2 contended that earlier, when the
State Government took a decision to replace Petitioner as Lead
Developer in the M/s Golden Jubilee Hotels Private Limited by
decision dated 30.09.2020, Petitioner challenged the same by
filing Writ Petition No. 17129 of 2020 and the said Writ Petition
was dismissed by order dated 28.04.2023 holding that when the
proceedings initiated under the provisions of IBC was ceased by
the Appellant Tribunal i.e. NCLAT, petitioner is not entitled to
invoke the jurisdiction of this Court under Article 226 of
Constitution of India. He also stated that the Writ Appeal No.
1135 of 2023 preferred by Petitioner was also dismissed on
26.06.2024 by the Division Bench on the ground of unexplained
inordinate delay. Special Leave Petition (c). No. 22186 of 2024
filed before the Hon'ble Supreme Court of India was also
dismissed on 20.09.2024. Learned Advocate General also
contended that NCLT after following the provisions of Sections
29, 30, and 31 of IBC, approved the Resolution Plan and
rejected the objections filed by petitioner in respect of
Resolution Plan approval by giving cogent reasons.
4.1. Clause 6.4 of the Request proposal issued by the
YAT & C (PMU) D clearly envisages that in the event of default of
payment, lender should have right to substitute the selected
bidder, in consultation with YAT &C (PMU) D, contends learned
Advocate General. The Bank had initiated proceeding before
NCLT invoking the provisions of 'IBC' and NCLT approved the
Resolution Plan and passed order on 07.02.2020. The Appeal
filed by Petitioner before the NCLAT against the approval of
Resolution Plan was also dismissed on 11.12.2024. He also
submits that Civil Appeal No.312 of 2025 filed against dismissal
of Appeal was also dismissed by the Hon'ble Supreme Court on
03.02.2025.
5. Learned Senior Counsel Sri Abhishek Manu Singhvi
appearing on behalf of Sri Rajesh Maddy, learned counsel for
Respondent No.4 submits that Petitioner has already sought the
exact relief before this Court in Writ Petition No. 17129 of 2020;
the appeals preferred thereagainst were also dismissed and
now, the same relief is being sought in a circuitous manner. The
single-largest shareholder, director and authorized signatory of
Petitioner who has filed the present Petition - Laxmi Narayan
Sharma, challenged Respondent No. 4's Resolution Plan,
including Clause 6.1 before the NCLT, NCLAT and the Hon'ble
Supreme Court and failed everywhere.
5.1. It is further submitted that earlier Writ Petition No.
17129 of 2020 was dismissed on the ground that after initiation
of CIRP, only NCLT has jurisdiction. The Hon'ble Supreme Court
has upheld the said order of this Court. The State of
Telangana's approval/ consent, which is under challenge in the
present Writ Petition is result of approval of Respondent No. 4's
Resolution Plan which provides that entire shareholding of
GJHPL shall stand transferred to Respondent No. 4 upon
achieving the approval/ consent of the State of Telangana.
5.2. Learned Senior Counsel contends that as per
Section 31(1) of IBC, a Resolution Plan once approved, has
binding effect on all the parties, including shareholders of
corporate debtors, i.e. Petitioner in this case (see Ghanashyam
Mishra & Sons Pvt. Ltd. v. Edelweiss Asset Reconstruction
Company Limited (2021) 13 SCR 737). As per Section 60(5)(c)
of IBC, the National Company Law Tribunal shall have
jurisdiction to entertain or dispose of any question of law or
facts, arising out of or in relation to the insolvency resolution or
liquidation proceedings of the corporate debtor. As per Section
238 of IBC, provisions of IBC have overriding effect,
notwithstanding anything inconsistent contained in any other
law for the time being in force or any instrument having effect
by virtue of any such law. IBC is a complete Code. Adherence of
protocols and procedures required for legal discipline. High
Court's power to interdict CIRP proceedings under the IBC
demands rigorous scrutiny and judicious application (see
Mohammed Enterprises (Tanzania) Ltd. v. Farooq Ali Khan
C.A. No. 48/ 2025).
5.3. According to learned Senior Counsel, the present
Writ Petition has been filed opportunistically, when the State of
Telangana granted its consent for change in shareholding of
GJHPL in order to create roadblocks in implementation of the
Plan. NCLT, Hyderabad passed the order dated 25.09.2025
recording that the State of Telangana approved Respondent No.
4's Resolution Plan. It is to be noted that role of Petitioner was
limited till bidding for the Project. Upon being declared as the
successful bidder, Petitioner is only a shareholder of the
SPV/GJHPL which enjoys all rights. As such, there is no locus
for Petitioner. Learned Senior Counsel also submits that it is
well-settled, a company is a juristic person and is distinct from
its shareholders - it is the company which owns the property
and not the shareholders - Bacha F. Guzdar v. Commissioner
of Income Tax, Bombay {(1954) 2 SCC 563}.
6. Having considered the rival submissions of the
learned counsel on either side, this Court is of the opinion that
the project company, Golden Jubilee Hotels Pvt. Ltd. entered
insolvency resolution under the IBC and the approved
Resolution Plan expressly required State Government's consent,
an exercise of contractual and statutory discretion. Petitioner's
challenges to transfer and restructuring of project
responsibilities have already failed before this Court in Writ
Petition No. 17129 of 2020 and Writ Appeal No.1135 of 2023
and before the Hon'ble Apex Court in S.L.P.(c).No. 22186 of
2024, conclusively holding that the provisions of the Insolvency
and Bankruptcy Code, 2016 override the Telangana
Infrastructure Development Enabling Act, 2001 to the extent of
inconsistency.
7. Further, once the NCLT-approved plan is in
operation, its terms, including permissible changes in
shareholding, are binding unless set aside in accordance with
the Code. The State's consent to Respondent No.4 is in line with
the Plan and the rights of petitioner, if any, arise out of contract
and are subject to the terms, including consequences of
insolvency and changes arising from judicial orders. The
argument that no notice was given or compensation was paid
ignores the supervening effect of the IBC and the scheme
approved thereunder. Proceedings regarding alleged contract
breaches or compensation are pending before the NCLT and the
petitioner's remedies lie therein.
8. The policy decision to negotiate with Respondent
No.4 draws from the requirements of the insolvency resolution
framework, not from a purely executive allocation of state
generosity. The selection was pursuant to a statutory process
i.e., CIRP under IBC, 2016 which is recognized by law,
distinguished from discretionary grants by public tender. The
alleged preferential treatment to EIH Ltd. is rooted in the
operational/commercial realities recognized in the Resolution
Plan and does not amount to hostile discrimination under
Article 14 of the Constitution, as the technical member and the
lead member's positions post-CIRP are not the same in law or
fact.
9. The FDI approvals and compliance with national
policy are the subject matter of competent central authorities
and not this Court's writ jurisdiction, unless a clear and gross
illegality is shown and none is established by petitioner. The
opportunity to represent concerns was part of the extensive
proceedings before NCLT, High Court and the Hon'ble Supreme
Court in related litigation. Re-litigation of settled issues is not
permissible. Further, petitioner has availed remedies before
multiple forums, lost on the core issues and now sought to be
reopened. The relief, if any, with respect to valuation,
compensation or contract enforcement would lie before the
specialized adjudicating authorities, but not in writ proceedings.
10. For the above reasons, this Court finds no merit in
the Writ Petition. The impugned decision of the Empowered
Committee dated 22.09.2025 does not suffer from any
constitutional or legal infirmity. Hence, the Writ Petition is liable
to be dismissed, however, to discourage this kind of frivolous
litigation, with costs.
11. The Writ Petition is accordingly dismissed with
costs of Rs.10 lacs to be payable to the Prime Minister's
National Relief Fund.
12. Consequently, miscellaneous Applications, if any
shall stand closed.
-------------------------------------
NAGESH BHEEMAPAKA, J
20th November 2025
ksld
