Robust Hotels Pvt. Ltd & Ors. Vs EIH Limited & Ors. (Supreme Court of India)
Supreme Court of India recently delivered a consolidated judgment in the appeals concerning Robust Hotels Pvt. Ltd & Ors. Vs EIH Limited & Ors. The case, which originated from two separate suits filed by EIH Ltd., a luxury hotel chain operator, against Balaji Construction (P) Ltd. (predecessor to Balaji Hotels & Enterprises Ltd. – BHEL) and subsequently Robust Hotels (P) Ltd., involved complex issues of contractual rights, interim injunctions, and the applicability of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).
Background of the Dispute
The core of the dispute dates back to October 26, 1988, when EIH Ltd. entered into a Technical Services Agreement (TSA) with Balaji Construction (P) Ltd. to provide expertise for hotel operations. Subsequent agreements in 2000 and 2002 detailed financial accommodations totaling over ₹15.12 crores from EIH to BHEL for hotel construction. These later agreements stipulated the termination of the TSA and granted BHEL the freedom to transfer the hotel unit, contingent upon the repayment of the ₹15.12 crores with interest by December 31, 2002. Balaji Industrial Corporation Ltd. (BICL) provided an irrevocable guarantee for this repayment.
