Rajasthan HC stays CBI court proceedings against Arun Shourie in a Udaipur hotel disinvestment sale case

CBI court proceedings against former Union Minister Arun Shourie and others have been stayed by the Rajasthan High Court in a case pertaining to a sale of Laxmi Vilas Palace Hotel in Udaipur in 2002.

Hearing the case, Justice Vijay Bishnoi ordered “that the trial court shall not proceed against the petitioners pursuant to the impugned order till further orders”. The High Court also called for records of the case from the trial court and listed the matter for hearing after three weeks.

Appearing through video conferencing, Shourie said the process of disinvestment of Laxmi Vilas Hotel had been challenged twice by the same person before the Division Bench of the Rajasthan High Court, but was dismissed both times—in 2002 and 2006.

He said that while dismissing the petitions, the High Court made “specific observations that no material has been placed that fixation of reserve price of shares was arbitrary”.

Appearing for Jyotsna Suri of Bharat Hotels Limited, which bought Laxmi Vilas Hotel in 2002, senior advocate P P Chaudhary termed the CBI court’s order as illegal and said Bharat Hotels Limited offered a bid of Rs 7.52 crore for Laxmi Vilas Hotel, which was 25 per cent above the reserve price, following which its bid was accepted.

Additional Solicitor General of India S V Raju too “strenuously submitted” that the order passed by the trial court “is not liable to be sustained in the eye of law”. He said the CBI has filed closure reports twice in the matter with detailed reasons for why no offence is made out against any of the persons named in the FIR. Yet, the trial “court, without considering the said reasons in right perspective, has illegally passed the impugned order.”

In an order on September 15, Special CBI Court Judge Pooran Kumar Sharma had rejected the CBI’s application to file a closure report in the investigation into the sale of Laxmi Vilas Palace Hotel. Rejecting the CBI’s plea that it had not found any evidence to launch prosecution, Judge Sharma said that prima facie it had been proved that the accused had abused their posts to cause a loss Rs 244 crore to the government of India in the sale of the hotel. The CBI court had also directed the district administration to take possession of the property.

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