Subramaniam Swamy’s contention is that AJPL’s Young Indian deal was a sham, intended to grab the Herald house- a property worth 1,600 crores- he says.

Sonia Rahul get bail in the National Herald Case Here is all you need to know
news National Herald Saturday, December 19, 2015 - 17:23

With the National Herald case still being the contentious issue in the never-ending tussle between the current and former ruling parties of the country, here is all you need to know about the case.

On Saturday, much to the relief of the Congress party, the court granted bail to the Gandhis. The next court hearing is scheduled to be held on February 20.

Earlier it was speculated that the Gandhis would approach the Supreme Court in order so that the top brass of the party did not have to appear on the court personally.

But on Saturday, almost all senior Congress leaders including the former PM Manmohan Singh , Ghulam Nabi Azad, AK Antony were present outside the court to showcase their support.

Background

Following a complaint filed by Subramanian Swamy (as a private citizen) in 2012, a court in Delhi issued summons to Sonia and Rahul Gandhi on July 25 earlier this year for misappropriation of funds in relation to the National Herald newspaper that was shut down some years ago.

Metropolitan magistrate Gomati Manocha, while issuing the summons, said, “I have found prima facie evidence against all the accused.”

Swamy approached the court accusing Sonia Gandhi and Rahul Gandhi of grabbing assets of a public limited company by floating a private company and using Congress party’ s funds. As per Income Tax Act, political parties are barred from funding business operations.

The case involves two companies, the Congress party and the real estate.

Associated Journals Pvt. Ltd (AJPL) set up by Jawaharlal Nehru in 1937 was the company that published the now defunct National Herald along with Navjivan and Quami Awaz newspapers and the International Weekly magazine.

Young Indian is a private company formed in the year 2002 with Congress President Sonia Gandhi, Vice-President Rahul Gandhi and Congress leaders Motilal Vohra and Oscar Fernandes as directors.

Sonia Gandhi and Rahul Gandhi together hold a 76% stake in Young Indian. The rest is held by Congress politicians Moti Lal Vora and Oscar Fernandes (12% each).

Congress party's loan to AJPL

In 2008, a fledging National Herald was closed down. Subramaniam Swamy alleges that in 2011, the Congress Party extended a loan of 90 crores to Associated Journals Pvt Ltd. This loan was apparently given to write off accumulated debts of Associated Journal Pvt Ltd and thereby restart the National Herald, which was closed in 2008.

When questioned about this in the past, the Congress party has said that extending the loan was part of its political dharma and for propagation of its ideology. The loan was paid off from over Rs 2000 crores donation, which the party received between 2004-05 and 2010-11.

With the help of the loan, APJL’s debts were written off.

Young Indian and AJPL

In the meantime, Young Indian proposed to take over the debt of over Rs 90 crore in lieu of 99.1% shares being transferred to them. Sonia Gandhi and Rahul Gandhi became owners of the AJPL thereby.

The Mint in an article in November 2102 says, On 21 December 2010, less than a month after its incorporation, AJL’s board approved the assignment of Rs.90.21 crore in accumulated loans taken from the All India Congress Committee (AICC), to Young Indian. This debt was then retired for a consideration of Rs.50 lakh, which Young Indian paid to AICC. On AJL’s books, it was converted into equity.

At the heart of the controversy is the Herald House building that AJPL owned, which now effectively belongs to the Young Indian now. In addition, National Herald has huge properties across the country in New Delhi, Mumbai, Lucknow, Allahabad, Bhopal, Indore and Panchukula. 

Subramaniam Swamy’s contention is that AJPL’s Young Indian deal was a sham, intended to grab the Herald house- a property worth 1,600 crores- he says.

 

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