The Supreme Court on Wednesday examined the valuation of Delhi’s Hyatt Regency hotel in the one-time settlement (OTS) agreement between Asian Hotels (North) Pvt Ltd and two public sector banks and observed that it must be satisfied that the settlement was in a “clean and transparent manner” as public money was involved.
A view of the Supreme Court of India (SC) building in New Delhi (ANI)”This money belongs to the people of the country…we understand the commercial wisdom in such matters, but we have to see whether this commercial wisdom is in the interest of the people of the country or in the interest of someone else,” a bench comprising Chief Justice of India Surya Kant and Justices Jaimalya Bagchi and Vipul M Pancholi said while hearing a petition filed by NGO watchdog Infrastructure.
The court issued notices to the central government, Punjab National Bank (PNB), Bank of Maharashtra (BOM) and Asian Hotels (North) Pvt Ltd, owner of Hyatt Regency Delhi, seeking their response.
The bench was hearing a challenge against the Delhi High Court’s November 3, 2025 judgment that dismissed a public interest litigation seeking a CBI and CVC probe into OTS contracts of two public sector banks with Asian hotels.
During the hearing, advocate Prashant Bhushan, appearing for the petitioner, argued that the banks had bypassed the compulsory auction route despite having more than stressed loans. ₹100 crores. “There was no auction. The agreement was that we would enter into a one-time settlement,” Bhushan, assisted by advocate Pranab Sachdeva, told the court.
Responding on behalf of the Centre, Additional Solicitor General N Venkataraman submitted that the arrears have been reduced. ₹242 crore from Rs ₹226 crores have been recovered by the banks ₹114 crore, indicating the impact of the Covid-19 pandemic on the hospitality sector.
Senior advocate Mukul Rohatgi, appearing for Asian Hotels, said the hotel was declared a non-performing asset (NPA) and had no room bookings during the pandemic, making repayments impossible.
The bench, however, questioned the timing and valuation of the settlement. “We understand whether this amount was recovered in 2020 or 2021, but this settlement happened in 2025, when Covid was long over and the hotel business was booming,” observed the court, adding that if the asset’s value is high after the NPA is declared, “people will go and auction it”.
When the Center submitted that the auction attempts had failed twice, the bench asked the Center and the banks to keep a record of the auction process on file. “Please produce the auction records,” the court said.
Emphasizing that judicial restraint does not mean abdication where public funds are involved, the bench said that courts do not normally interfere with commercial decisions, “commercial wisdom is for the benefit of the public”.
The court also noted the petitioner’s complaint that despite the recovery of the hospitality sector by 2025, hotel property values were allegedly low. ₹300-400 crores? The Bench observed.
The infrastructure watchdog had approached the apex court, arguing that the OTS was finalized in violation of Reserve Bank of India guidelines mandating auctioning of stressed assets. ₹100 crores, and the valuation of the Hyatt property was greatly reduced ₹2,600 crore in 2021 ₹970 crore in 2024 despite rising real estate prices in Delhi-NCR.
