National Herald case: Delhi Police files case against Sonia, Rahul Gandhi among others

New Delhi: Delhi Police has registered a case of cheating and criminal conspiracy against top Congress leaders Sonia Gandhi and Rahul Gandhi among others on a complaint filed by the Enforcement Directorate (ED) in the National Herald issue alleging they fraudulently acquired Associated Journals Ltd (AJL) that was publishing the party mouthpiece.

Congress called the FIR, which was registered on October 3 and came in public domain on Sunday, “completely bogus” and a “one trick wonder of a case where no money moved, where no immovable property transferred yet money laundering (was) invented”.

Besides Rahul and Sonia, the FIR names Congress leaders Suman Dubey and Sam Pitroda,Young Indian (YI) and Dotex Merchandise Ltd, Dotex promoter Sunil Bhandari, AJL and unknown others.

Police registered the case under Sections 120B (criminal conspiracy), 403 (dishonest misappropriation of property), 406 (punishment for criminal breach of trust) and 420 (cheating) of the Indian Penal Code.

The total proceeds of crime was pegged at Rs 988.03 crore - AJL share worth Rs 90.21 crore with Young Indian, immovable properties of AJL worth Rs 755.15 crore and rent received Rs 142.67 crore.

The ED invoked section 66(2) of the Prevention of Money Laundering Act (PMLA), which allows the agency to share evidence for registration of a case by a law enforcement agency so that it can subsequently book a money laundering case to take it forward, to ask the Delhi Police to register a case.

The agency was investigating the case following a court order that took cognisance of a private complaint by BJP leader Subramanian Swamy in June 2014. The ED told the police that it has "additional facts" that disclose cognisable offences which are "beyond" the scope of the complaint of Swamy and the court order.

The ED had filed a chargesheet in the case in a Delhi court in April and the court is yet to take its cognisance with the next date of hearing scheduled for December 16.

The Gandhis are accused of fraudulently taking over the AJL, which has properties worth over Rs 2,000 crore through Young Indian, where Sonia and Rahul together have 76 per cent equity, by paying just Rs 50 lakh.

The Young Indian had acquired Rs 90.21 crore debt AJL owed to the All India Congress Committee and the AJL converting it into equity shares in favour of the former.

The ED alleged it was defrauding shareholders of AJL on one hand and also its public donors and dishonestly inducing AICC to forego its right to recover Rs 90.21 crore advance it gave to the publisher of National Herald.

According to the ED, the AICC could have become a 99% shareholder to AJL properties worth Rs 2,000 crore. Members as well as donors of AICC have been cheated by fraudulent and false misrepresentations, which include that the loan was not recoverable and selling of the right to recover the loan, it said.

The ED complaint quoted in the FIR said Rs 18.12 crore in 2017-18 which are “not found to be genuine”. It claimed the purpose of collecting "bogus" donations was to deal with the income tax demand of Young Indian, which otherwise would have fallen on the Gandhis as they are the beneficial owners.

AJL also collected "bogus" advance rent of Rs 38.41 crore during the same period and it was found to be "fake as no rent agreements existed".

It also claimed that the AJL received Rs 29.45 crore from advertisement for its newspapers between 2017-18 and 2020-21 but investigations showed that Rs 15.86 crore was given by various Congress affiliated bodies and the rest from others.

The ED claimed that when enquired with donors, some of them claimed that the money was paid to seek protection from Congress leaders in the course of their regular business. Most advertisements given do not commensurate with business purposes of the donors as these were mostly in the form of congratulatory messages or birthday wishes to Congress top leaders, it said.

National Herald case

* ED takes up probe following a court order in June 2014 on a complaint by Subramanian Swamy.

* ED files chargesheet in Delhi court in April; Not taken cognizance by court yet; next hearing on December 16.

* Sonia Gandhi, Rahul Gandhi among others accused of fraudulently acquiring Associated Journals Ltd (AJL).

* AJL, which has property worth Rs 2,000 crore, publishes Congress mouthpiece National Herald.

* AJL borrowed funds from All India Congress Committee; Rs 90.21 crore was due.

* Young India, in which Sonia and Rahul have 76 per cent equity, buys the right to recover AJL loans for Rs 50 lakh.

* Allegation is that the Gandhis took control of AJL by defrauding AICC and its donors.

* ED says in its complaint to Delhi Police that AICC deprived of becoming 99 per cent of shareholder of AJL by claiming that the loan was not recoverable.

* Total proceeds of crime is alleged to be Rs 988 crore.

* ED raises says Rs 18 crore received by Young Indian in 2017-18 as not genuine.

* AJL receives Rs 38.4 crore as advance rent but all found bogus, ED says.

* Rs 29.45 crore from advertisement between 2017-18 and 2020-21, which includes Rs 15.86 crore by various Congress affiliated bodies.

* Some claimed money given for advertisements to seek protection from Congress leaders in the course of their regular business, ED says.