A hoteliers' collective in Bengaluru, capital of the Indian state of Karnataka, has written a complaint to the City Police Commissioner to probe OYO Hotels and Homes.

The letter from the Bruhat Bengaluru Hotels Association alleges that OYO, India's largest hotel management chain, has been conducting business improperly, renting out rooms for less than 1000 Rupees a day despite agreeing not to.

In recent months, the association claims 100 member hotels have left OYO, and the pattern is similar across the state. OYO has claimed that no formal complaint was made.

“While vested interest groups are creating unnecessary public uproar to sensationalize the matter, real OYO asset owners that are facing issues, if any, are reaching out to find solutions and get back to running the business," said OYO in a statement. "They are focused on finding ways to improve customer experience and thereby their occupancy and profitability."

The development comes after police in the Bangalore neighbourhood of Whitefield booked OYO CEO and founder Ritesh Agarwal and others for cheating and criminal breach of trust following a complaint by city-based hotelier Natarajan, owner of Rajguru Shelter Hotels. The hotelier alleged that OYO violated an agreement of taking 20 percent commission from each reservation and in the process cheated him Rs 10 million, or NZ$219,300.