Wins long-drawn legal battle over control of Hotel Wildflower Hall
TNR News Network
Shimla:
The financially struggling Himachal Pradesh government has secured a Rs 401 crore windfall after winning a crucial legal battle over the ownership of the iconic Wildflower Hall property in Chharabra, near Shimla.
The ruling, passed by the Himachal Pradesh High Court, ends a decades-old dispute between the state and East India Hotels (EIH) over Mashobra Resorts Limited (MRL), the joint venture company that operated the luxury resort. With this decision, the state becomes the sole owner of the company and gains full control over its assets and finances.
State to gain Rs 401 crore in cash, shares, asset value
The High Court order mandates that the state government will now receive Rs 320 crore from MRL’s bank balances, Rs 25 crore as an additional payment following arbitration and full transfer of EIH’s Rs 136 crore shareholding in the joint venture.
However, the EIH will only receive Rs 68 crore in return, 50% of its original capital contribution, giving the state an additional Rs 68 crore gain in asset value. In total, the financial benefit to the state exchequer stands at Rs 401 crore, a significant boost for a government battling mounting debts and a widening fiscal deficit.
A state government spokesperson confirmed the financial details and called it a “landmark win” , for the Chief Minister Sukhvinder Singh Sukhu’s administration that would provide much-needed relief amid a period of serious fiscal stress.
Decades-old dispute ends in Supreme Court-backed settlement
The legal tussle over Wildflower Hall dates back nearly 30 years. Originally, the Himachal Pradesh government and EIH (a part of the Oberoi Group) had formed a joint venture — Mashobra Resorts Limited — to operate the luxury hotel property.
However, over the years, ownership and financial disagreements arose, prompting prolonged legal action. The matter escalated to the Supreme Court, which on February 20, 2024, passed an order transferring full ownership and control of the Wildflower Hall property to the Himachal Pradesh government. The state subsequently took physical possession of the property on March 31, 2025.
“This is a result of the consistent and determined legal strategy of the present government. We have not only recovered control over a strategic property but have also secured substantial financial benefits from it,” the spokesperson said.
Another legal win: State secures higher royalties from hydel project
In addition to the Wildflower Hall victory, the Himachal Pradesh government has recently scored another major legal success. The Supreme Court ruled in favour of the state in a case concerning royalty payments from the Karcham Wangtoo hydroelectric project. Previously, the state received 12% royalty from the operating company. The new ruling raised this to 18%, translating to over Rs 250 crore in annual revenue for the state.
Chief Minister Sukhvinder Singh Sukhu expressed satisfaction over the High Court verdict in the Wildflower Hall case and reiterated his government’s commitment to protecting and monetising public assets.
“This decision is a testament to our resolve to reclaim Himachal’s rightful share in its resources,” Sukhu said in a statement. “Whether it’s luxury properties or hydropower projects, the state will not allow itself to be sidelined.”
What is Wildflower Hall?
Located at over 8,000 feet above sea level in Chharabra, just outside Shimla, Wildflower Hall is a heritage hotel operated under the Oberoi brand. Originally the summer residence of Lord Kitchener, the property was redeveloped as a luxury resort and has since remained one of the most prestigious hospitality assets in the region.
With the legal battle now resolved and the state holding full ownership, the Himachal government is expected to decide whether to continue its partnership with a private operator or bring the property fully under state management.
