In July 2009, Chhundu travels, which had entered into an agreement with the Oberoi groups, a leading hotel luxury brand in India, to jointly begin a Nu 1.17 bn pair of luxury hotels in Bhutan, sued Oberoi, for allegedly withdrawing from the agreement.

The case, which was filed with Thimphu district court, has not budged an inch.

Sources said the Oberoi had asked a law firm in India, Khaitan and co., to research and look into the joint venture case in August 2009. Speculation has it that Oberoi has filed a court case against Chhundu in New Delhi. The company’s spokesperson has not responded to Kuensel on the issue.

Former high court lawyer, Cheda, was also asked to study the case by the Oberoi groups and to represent them in court. He has not heard from them since September 2009.

A memorandum of understanding (MoU) between the two companies was signed in November 2006 to build two five star hotels in Paro and Thimphu. The plan was to build one hotel at Chengaydaphu, Thimphu, spread over a 15 acre area, and the other near Drugyel high school in Paro on a 14 acre plot.

Khendum Dorji, who started Chhundu travels in 1986, said that she has not heard from the Oberoi groups at all after the court case was filed.

Many judiciary officials, however, feel that the district court has no jurisdiction over this FDI case, as a clause in the MoU signed by Oberoi and Chhundu states that the agreement is governed by Singaporean law and, therefore, the centre for arbitration or to resolve disputes is Singapore.

Chhundu had consulted while signing the MoU a corporate lawyer in India, who said that although the MoU is governed by Singaporean law, the law can be applied everywhere, said Khendum Dorji in an earlier interview.

“There is a possibility that Oberoi might have filed a case in India because, from what we hear, the applicable law governing the MoU is Indian law,” said a Bhutanese lawyer.