In a significant decision, the Himachal Pradesh High Court on Tuesday mandated the shutdown of 18 out of the 56 hotels operated by the Himachal Pradesh Tourism Development Corporation (HPTDC). This ruling was prompted by the substantial financial losses these establishments have caused, which Justice Ajay Mohan Goel labeled as a “burden on the state exchequer.”
Among the properties slated for closure are prominent sites such as The Palace Hotel in Chail and The Castle in Naggar, Kullu. The decision comes into effect on November 25, highlighting the court’s concern over the ongoing fiscal strain on the state’s resources due to these “white elephants.”
This judgment aligns with another recent ruling by the same bench, which involved the attachment of Himachal Bhawan in New Delhi concerning unpaid dues in the Seli Hydro Project case. Justice Goel’s remarks pointed to an urgent need for financial overhaul within the HPTDC, following its continued operational inefficiencies and inability to boost occupancy rates.
The closures are expected to have significant implications for the state’s tourism sector, heavily reliant on robust public and private hospitality infrastructure. Local tourism expert Akshay Sood anticipates ripple effects across the industry, stressing the importance of fiscal prudence and resource optimization in state-run enterprises.
The ruling also addressed the delayed payments of post-retirement benefits to former HPTDC employees, a key issue that led to the court’s intervention. Justice Goel has directed that funds be prioritized for the release to retired Class-IV employees and families of deceased workers, drawing from the resources conserved by the impending hotel closures.
This closure list includes not just The Palace and The Castle but extends to 16 other properties across the state, each grappling with underperformance and financial liabilities.
