Two Independent Directors of Asian Hotels (West) resign
Raj Kumar Bhargava and Lalit Bhasin resign as Independent Directors of the Asian hotels ( West)company with effect from 8 June, 2021, the company said in a regulatory filing, days after Asian Hotels (West) , owner of Hyatt Regency Mumbai announced the suspension of operations due to fund crunch.
In separate resignation letters sent by both the directors, they cited refusal of the chairperson to convene board meeting to discuss financial problems of the firm, as the reason behind their resignation.
While Raj Kumar Bhargava said he sees "no future in the company as no funds are coming from promoters," in his resignation letter, Lalit Bhasin highlighted the atmosphere of hostility among the promoters. Bhasin also said that the company was in default of not only bank loans but also statutory dues.
Earlier, Global hospitality firm Hyatt Hotels Corporation has suspended operations at Hyatt Regency hotel in Mumbai, and said the property will remain closed till further notice since Asian Hotels (West) Ltd which owns the property is not making payments for its salaries and operations.
Later, Asian Hotels (West), owner of Hyatt Regency Mumbai whose operations have been suspended, said Yes Bank has barred it from making payments from an escrow account following a loan default.
In a regulatory filing, Asian Hotels (West) said the company on April 28, 2021 defaulted on a loan repayment to Yes Bank due to the massive effect of COVID-19 pandemic on the company and the entire hotel industry.
Since then, Yes Bank has held all funds "including daily hotel collections in the escrow account and the Company/ Hotel are not allowed to make any payment including government taxes (like GST, VAT, TDS, PF, ESIC, etc.), vendors payments, on roll employees' salaries (more than 300 hotel and corporate employees) and other critical hotel services from the said account", it added.
Yes Bank has only made some payments from the company's escrow account towards the hotel's electricity, water and gas charges, Asian Hotels (West) said.