HC allows Hotel Leela Ventures to include Mumbai properties to pay debt

The high court has given the beleaguered hospitality company HLV Ltd, earlier called Hotel Leela Ventures, relief by allowing the company to include its Mumbai properties in the process of restructuring its debt of over Rs 7,000 crore. In a judgment passed in October 2019, but made available on the website only last week, Justice SC Gupte rejected an appeal filed by the Airport Authority of India, which owns the land on which The Hotel Leela (near the Mumbai international airport) stands. AAI had argued that HLV was trying to avoid paying over Rs 800 crore of lease rent and minimum guarantee amount. The land in question is 29,000 square metres. Justice Gupte observed that for a plaintiff (AAI) to make out a case against debtor (HLV) of transfer of property with intent to defraud creditors, there should be some secret or surreptitious acts on the part of the debtor to dispose of the latter's property. The court also said that there is no proof that HLV is trying to delay the payments of creditors. The court further observed that HLV was a public limited company, and the process of debt restructuring was being supervised by Securities and Exchange Board of India and the stock exchanges. "The whole exercise is being carried out in the full glare of these authorities and is scrupulously subjected to their regulatory powers. The record also indicates the various steps adopted by the defendant and its promoters to achieve the present reorganisation," the court said.