The Enforcement Directorate (ED) on Wednesday alleged that Congress leaders Sonia Gandhi and Rahul Gandhi were at the forefront of a conspiracy to take control of Associated Journals Limited (AJL) assets, a ₹2,000 crore company which is famous for publishing the National Herald newspaper.
At a hearing in a Delhi court heard by Special Judge Vishal Gogne, Additional Solicitor General (ASG) S.V. Raju made submissions regarding the cognisance of ED's chargesheet in the much-publicized National Herald case.
Raju had claimed that Young Indian Private Limited, in which Sonia and Rahul Gandhi jointly hold 76% of its shares, was formed on a strategic basis to acquire AJL's assets of value. AJL, Raju claimed, had floated a ₹90 crore loan from the All India Congress Committee (AICC), even before it had assets running into thousands crores.
Describing the facts of the so-called conspiracy, Raju stated, "AJL was not earning profits but they had assets of ₹2,000 crore. But they were struggling to meet their day-to-day expenses. If you are fairly good, you cannot say, I am loss, etc. You need to create a show. ₹90 crore amount was taken from the AICC. They (AJL) told us we cannot repay you (AICC). Normally, any sensible individual would have offloaded their wealth. ₹90 crore is peanuts."
He also contended that Young Indian was formed to enable this movement of wealth. "The conspiracy was making of Young Indian to seize ₹2,000 crore in return for a ₹90 crore loan. Sonia and Rahul Gandhi wanted to acquire this ₹2,000 crore company," Raju alleged.
In a span of six days from Rahul Gandhi becoming a director of Young Indian, the company reportedly approached AJL for repayment of the loan or conversion into equity, which would make Young Indian de facto owner of AJL.
Judge Gogne, in a bid to clarify, wanted to know if the AICC could have written off the loan like public sector banks have been known to do for non-performing assets.
Answering the question, Raju stated, "Banks had written off defaulters' loans in the absence of asset as collateral but here AJL had assets to the tune of ₹2,000 crore which they handed over for a loan of ₹90 crore."
Raju also claimed that the AICC had tried to step back from the deal so as not to attract attention. "The AICC stepped back from a direct transaction so as not to 'create ripples' and instead formed Young Indian," he explained to the court.
When the judge inquired whether it was common for a political party to be the owner of a media outlet, Raju replied, "Political parties buy running newspapers and channels. The big question is how can they buy an asset for peanuts?" He noted that AJL was bought by Young Indian—a company in which the Gandhis had majority stakes.
"Left-hand taking and right-hand taking. Sale and purchase of shares. All sham transactions," Raju criticized the nature of the deal.
The court fixed July 3 for the next hearing to continue scrutinizing the ED's contentions.
Earlier, on May 21, the ED had asserted that the proceeds of crime in the case, according to the allegations, were received under the supervision of the top Congress leaders, utilized for political favors like candidate promotions, protection, and party assignments.
The ED's chargesheet has been filed under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA) against Sonia and Rahul Gandhi, deceased Congress leaders Motilal Vora and Oscar Fernandes, and others such as Suman Dubey, Sam Pitroda, Sunil Bhandari, Young Indian Private Limited, and Dotex Merchandise Private Limited.
The agency charges the group with attempting a criminal conspiracy to illegally acquire AJL's large real estate and financial holdings, worth over ₹2,000 crore, it alleges.
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