MUMBAI: In a relief to Siddhivinayak Realties- a joint venture between Oberoi Realty, and founders of D B Realty Shahid Balwa and Vinod Goenka, the Bombay High Court has set aside the arbitration order in Tulip Star Hotel case which will pave the way for the real-estate company to develop the land parcel.

In a further development though, ET has learnt that Ajit Kerkar-controlled V Hotels has decided to move the division bench. "We are going to challenge the order in higher courts under the Arbitration Act of 1996," said Hiroo Advani, managing partner of Advani & Co that is representing V Hotels.

In an order passed in favor of Siddhivinayak Realties, Justice RD Dhanuka noted, " In my view, arbitrator has to decide in accordance with the provisions of contract entered into between the parties and has to decide it in accordance with substantive law,"

"The impugned award however, in my view, being contrary to the provisions of Master Asset Purchase Agreement (MAPA) and contrary to contract Act and ignoring the material piece of evidence laid by parties and is patently illegal and thus warrants interference of this Court under Section 34 of the Arbitration Act," said the order.

Earlier in July 2011 , an arbitration panel ruled against Siddhivinayak Realtiesand asked V Hotels, the current owner of the property, to refund 73 crore to Siddhivinayak within 90 days. The joint venture firm is being represented by ParimalK Shroff& Co.

Siddhivinayak Realties challenged the arbitration award that directed V Hotels, owner of Centaur Hotel, to repay Rs 73 crore deposited to develop the property in 2005. V Hotel's contention was that there were concrete grounds on which the arbitrator had allowed termination of the agreement.

In 2005, Siddhivinayak Realties had agreed to purchase Centaur Hotel from Ajit Kerkar, former chief of Indian Hotels, and the Tulip Group, which had bought it when the government divested.

http://www.sarvodya.com/blog/supertech-araville-in-gurgao...

In 2005, Siddhivinayak Realtieshad agreed to purchase the hotel from Ajit Kerkar and the Tulip Group for a price of around 300 crore. Following this, the company had submitted 73 crore to Tulip along with 2 crore in an escrow account.

Earlier, the property known as Centaur Hotel was acquired by Kerkar and the Tulip Group from Air India's subsidiary, Hotel Corporation of India, during the privatisation exercise undertaken by the BJP-led National Democratic Alliance government. However, a Central Bureau of Investigation inquiry was launched in this regard following some allegations of corruption in the sale process.

On the date of judgment, shares of Oberoi RealtyBSE 2.83 % closed at 233.45 on the BSE, up 0.13% while the stock of DB Realty closed 1.63% down at Rs 69. 25.