NEW DELHI: The Supreme Court has ordered the Enforcement Directorate (ED) to unfreeze 12 properties of corporate debtor V Hotels Ltd, which includes land in Maharashtra valued at approximately ₹4,000 crore. This decision marks a significant victory for Lodha Developers, which acquired V Hotels through the insolvency resolution process last year.
Among the assets to be released is Mumbai’s prestigious Centaur Hotel located in Juhu. Lodha Developers, previously known as Macrotech Developers, acquired V Hotels via a ₹890-crore resolution plan sanctioned by the National Company Law Tribunal (NCLT) in April of last year. The company had deposited ₹520.80 crore as security to lift the ED’s attachment, as mandated by the Supreme Court in July.
A bench led by Justice M.M. Sundresh, in a consent order, stated that the attached properties “are directed to be restored to the successful resolution applicant, who stepped into the shoes of the corporate debtor upon successful resolution under the CIRP.”
However, the court clarified that the protection awarded to Lodha under Section 32A of the Insolvency and Bankruptcy Code is contingent upon the developer having no connections with the former promoters of V Hotels (previously Tulip Hospitality Services) and not having benefited from any proceeds of crime. Should the investigation reveal otherwise, the ED reserves the right to act accordingly, including contesting the resolution plan.
The order also instructed the ED to return the ₹520.80 crore deposit, along with accrued interest, within two weeks. Any challenges by the ED regarding the NCLT’s validation of the resolution plan “shall end,” and the agency will have no claims over the properties of V Hotels or any assets encompassed by the plan.
Nevertheless, the Supreme Court emphasized that the ECIR against the former promoters and directors of V Hotels will remain in effect. This order, issued under Section 8(8) of the Prevention of Money Laundering Act, was based on the “peculiar facts” of the case and is not intended as a precedent.
