Kerala govt loses court
battle over luxury hotel owned by NRI
THIRUVANANTHAPURAM, April 10, 2005
Gulf Times
Kerala High Court has termed as ‘arbitrary and illegal’ the
takeover by the state government of the Halcyon Castle on Kovalam beach
from Oman-based Galfar group.
Acting Chief Justice Radhakrishnan ordered the government to hand back
the four-hectare property and its adjoining structures immediately to
M-Far Hotels Limited owned by the Galfar group.
The court also ordered the government to pay Rs10,000 as court expenses
to the company headed by non-resident Indian businessman P Mohamed Ali.
The court said the property was part of the Kovalam Ashok Beach Resort
owned by India Tourism Development Corporation (ITDC) which sold it
after a competitive global tender. The castle formed part of the luxury
hotel.
The state government took over the property on September 25 after a
prolonged agitation spearheaded by opposition Communist Party of India
(Marxist).
The federal government decided to sell the resort as part of its divestment
policy. The M-Far soon entered into a deal with Le Meridien, which is
already operating another Galfar-owned property in Kochi, to run the
hotel.
State Tourism Minister K C Venguopal meanwhile said the government
would challenge the high court verdict in the Supreme Court.
Terming the takeover “undemocratic” and “a decision
taken in undue haste”, the high court said proper notices were
not served on the new owners and they were not given an opportunity
to explain their side before being driven out.
The court said the government could take over the property only after
fulfilling all legal procedures.
Title Deed Ghost Haunts Halcyon Castle- Who owns Halcyon Castle?
THIRUVANANTHAPURAM, JUNE 20, 2004
Indian Express Group
M SARITA VARMA
:Did the ITDC disinvestment spree wrap up a sale without a title deed?
Top honchos of Indian banking and corporate landscape like RBI governor
YV Reddy to Tata group chairman Ratan Tata who checked into Kerala’s
Kovalam beach would have been unaware of the mystery brewing around
their lodgings.
But the sea-side castle has thrown open a whole host of haunting issues
for legal eagles, real estate barons and policy-makers, a full three
years after its sale to an NRI-hotel Group in Oman. At once complex
and simple, the questions boil down to this: Who owns Halcyon Castle?
For those fragile on fables, a halcyon is a kingfisher that nests on
the sea. Halcyon is symbolised as as the icon of calm among storm, but
nobody can now dispute that eggs of a long-running controversy are hatching
around the sea-nestled Halcyon Castle.
The Castle, visibly inspired by British fairy tale castle illustrations,
is part of the 65-acre Ashok Beach Resort, once owned by ITDC. The castle
used to be the summer resort of the erstwhile royal family of Travancore.
The sale of the resort to the Oman-based Gulfar group for Rs 48 crore
brought the Halcyon Castle to the new owner’s hands. Ashok Beach
Resort is now the 360-bed Kovalam Hotels, managed by Le Meredian Group.
Says Vijaya Kumar, CPI(M) leader and former Speaker, Kerala Assembly,
"We had our doubts about the paltry Rs 48 crore as the ITDC property’s
price then since even the land part of Halcyon Castle of the hotel property
alone is known to be worth Rs 38 crore."
However, it is the Congress-led UDF government in Kerala which raised
the first official review of the sale, which happened during the tenure
of CPI(M)-led LDF government in 2001.
"The sale of the Castle and all its papers are under detailed
examination by government’s legal counsel," says Kerala chief
minister AK Antony. If Kerala government did not make a claim for the
Castle in 2001, that was only because it could not produce the title
deed, say state government officials. Gulfar Group, who holds possession
of the Castle, initially had some expansion plans for Kovalam Hotels,
roping in even its original designer Charles Correa. The downsizing
of these plans fuelled to the widespread doubts that the management
also did not have the benefit of the title deed.
When contacted by FE, the Kovalam Hotels spokesman declined to comment.
After the issue of who holds the title deed, another option that the
state government is studying is whether a heritage category for the
century-old castle could bring it to the state’s hands. What happens
then to the purchase contract between ITDC and Gulfar Group? If Kerala
government can be believed, this is fluid. "The contract would
be valid only if the state Cabinet ratified the understanding reached
in the discussions between ITDC and state government. This is yet to
happen," claims T Balakrishan, tourism secretary, Kerala.
Meanwhile, a Gulfar director has announced that the company was in
legally sound position and any debate around the title document is baseless.
True to the unruffled waterbird it is named after, the castle stands
foursquare and 2-storeyed at the sea of discussions around it. For years,
the tawn limestone structure on the palm-fringed Kovalam sands had caught
the eye of geologists and historians. And now it is the turn of businessmen
and lawyers too.