"RAM PARSHOTAM MITTAL v. HOTEL QUEEN ROAD PVT.LTD. ANDORS. INSC 617 "

The Government of India decided to divest its shares in the Indian Tourism Development Corporation , which included the Indraprastha Hotel . Through an approved scheme of arrangement involving demerger, the hotel was transferred to Hotel Queen Road Pvt. Ltd. , established as a Special Purpose Vehicle specifically for this disinvestment purpose. Initially, HQRL had a paid-up capital of Rs. 90 lakhs, divided into 9 lakh equity shares of Rs. 10 each. The Government of India held 89.97% of these shares, with Indian Hotels Co. Ltd. holding the remaining 10%, while a portion was owned by ITDC employees under a Voluntary Retirement Scheme.

Subsequently, the Government initiated the sale of its shares in HQRL through a bidding process. Moral Trading & Investment Ltd. , a public limited company, emerged as the successful bidder. Moral acquired the shares held by the Government of India and IHCL in HQRL for a total of Rs. 45 crores. To finance this acquisition, Moral secured Rs. 33.37 crores through loans from banks. This transaction marked a significant step in the disinvestment strategy of the Government, transferring ownership of the Indraprastha Hotel to private hands while providing capital for further development and operations of HQRL.