Dashing the hopes of Jasdev Singh Akoi, one of the two heirs of the iconic Imperial Hotel, the Delhi high court has prevented him from taking over the management of the landmark hotel along with his sister Alape Kaur.
The court in its ruling contented that Alape Kaur cannot exercise voting rights in favour of either Jasdev or the other brother and heir Hardev Singh, against whom the brother-sister duo had moved court.
By giving Kaur voting rights, the court further said that the entire business would be handled by one of the brothers with her help, thereby excluding the other.
Jasdev Singh Akoi and Alape Kaur (a silent partner, who has 12 per cent share in the hotel's profit or loss) had moved court earlier this March seeking approval for a majority say in the decision-making of the hotel.
The Imperial is one of Delhi's best known landmarks. The stand-alone boutique super-luxury hotel is spread over 15 acres of land on Janpath.
Based on current land valuations alone, excluding the landmark hotel building itself, the hotel could be worth hundreds of crore. Since it is a privately held company, the hotel's revenues and financials are not in the public domain.
In 2002, Jasdev Singh and brother Hardev Singh had become 50-50 owners of the hotel following the demise of their father. The two brothers then reached an agreement and formed the firm Akoi Saab with their sister for the management of the hotel, under which she would get 12 per cent of the profits but have no voting rights or say in the hotel's business.
Subsequently, differences cropped up between Hardev Singh and Jasdev Singh. These differences were confined not only to Hotel Imperial but also to other jointly-owned properties.
The brother-sister duo of Jasdev and Alape Kaur then filed a suit in the High Court alleging that the differences between the brothers were affecting the hotel's business and sought permission to allow Akoi Saab to take decisions by a majority vote of the partners.
This would tantamount to giving sister Alape Kaur voting rights. Appearing for the plaintiffs, senior counsel Arun Jaitley had argued, "She (Kaur) was not only to derive profits from the hotel but also bear the losses suffered by it. Under these circumstances, it could not be said that she was a `sleeping partner'."
The court has now ruled that Kaur cannot exercise voting rights in favour of either of the two brothers.
The family feud was not limited to the permanent injunction on the management of the hotel. In the partnership deed, Jasdev Singh's son Gobind Singh Akoi was allowed to draw cheques of up to Rs 10 lakh. Hardev Singh alleged that his nephew had broken the contract by issuing cheques of Rs 20 lakh and siphoning off funds.
The plaintiffs, meanwhile, in their suit had accused Hardev Singh of wrongly issuing power of attorneys to his sons Adil Singh Akoi and Fateh Singh Akoi. "My client gave the power of attorneys to his sons when he found out that large sums of money were being siphoned from the hotel," Ajoy Kalia, advocate for Hardev Singh Akoi, had contended.
The court has also asked both brothers to jointly decide on one person for holding the power of attorney.
Meanwhile, Alape Kaur and Jasdev Singh today filed an appeal before the division bench through lawyer Arun Jaitley against the single judge order of the Delhi High Court.
The bench consisting of Chief Justice M K Sharma and Justice Sanjeev Khanna passed an interim order asking the brothers to jointly issue cheques for the management and functioning of the firm Akoi Saab, with the rider that none of the two shall withhold signing them for any reason.
On allegations from the lawyer for the respondent, Abhishek Singhvi that Hardev Singh was not shown, despite requests, the sales and purchase accounts of Akoi Saab, the bench asked the petitioners to furnish a weekly statement to Hardev Singh on the same.
The court has also asked both parties not to make any correspondence that may stall the functioning of the firm. These are, however, interim orders that would continue till the court hears the matter further on August 7.
