SONIA & RAHUL

THE NATIONAL HERALD CASE

UNDER PREVENTION OF MONEY LAUNDERING ACT
 The National Herald case: Under P M L A
In 2012, BJP leader and advocate Subramanian Swamy filed a complaint before a
trial court alleging that some Congress leaders were involved in cheating and
breach of trust in the acquisition of Associated Journals Ltd by Young Indian Ltd
(YIL). He alleged that YIL had taken over the assets of the National Herald in a
'malicious' way.
Under the Income Tax Act, no political organisation can have financial transactions
with a third party. Swamy claimed that Young Indian Ltd paid only Rs 50 lakh for the
right to recover Rs 90 crore Associated Journals Limited owed to the party. This
implies that the Congress had written off the remaining Rs 89.5 crore.
Congress leader Rahul Gandhi, today [13/6/22], appeared before the Enforcement
Directorate (ED) in New Delhi for questioning in the National Herald money laundering
case. as Subramanian Swamy had filed a complaint.
The investigating agency had summoned Rahul Gandhi and
his mother, Congress President Sonia Gandhi, to explain allegations
of money laundering in the National Herald Case. Rahul Gandhi
marched to the ED office in the national capital, accompanied by
hundreds of party members. However, due to Covid related issues,
Sonia Gandhi is admitted to a hospital in Delhi because of which ED
has issued her a fresh summons for June 23. The Enforcement
Directorate will record Rahul Gandhi's statement under the criminal
sections of the Prevention of Money Laundering Act (PMLA). Rahul
Gandhi is the Lok Sabha member from Wayanad in Kerala.
The probe is related to alleged financial irregularities in the Young

Indian Pvt Limited owned National Herald newspaper.

What is the National Herald case?

India's first Prime Minister Jawaharlal Nehru started the National Herald
newspaper in 1938. The newspaper was published by Associated Journals
Limited (AJL) which was founded in 1937 with 5,000 other freedom fighters as its
shareholders. The company did not belong to any one person.

In 2010, the Associated Journals Limited had 1,057 shareholders. It incurred losses, and
its holdings were transferred to Young Indian Pvt Ltd (YIL) in 2011, with Sonia Gandhi
and Rahul Gandhi on the board of directors.
At the time of shutting down the National Herald in 2008, Associated
Journals Limited owed the Congress an accumulated debt of Rs 90
crore. In 2010, the Congress assigned this debt to Young India Private
Limited, a non-profit company that had been created a few months
earlier. Sonia Gandhi and Rahul Gandhi each own 38% of the
company. The remaining 24% share of the company is owned by
Congress leaders Motilal Vora and Oscar Fernandes, (Vora and
Fernandes have died), journalist Suman Dubey and entrepreneur Sam
Pitroda, who are also named in the case.
 Drama to save the Gandhi family and not democracy

NEW DELHI: As the Enforcement Directorate questioned Rahul Gandhi in

the National Herald case on Monday [13/6/2022], BJP dismissed the
Congress allegations of ‘vendetta’ and called the opposition party’s protests
as a “drama to save the Gandhi family and not democracy” as it defended
the agency’s action. The party accused Congress of putting pressure on ED,
saying its leaders hit the streets in support of corruption and to protect the
‘assets’ of the Gandhi family.
“The clarion call of Rahul Gandhi to Congress workers to

reach the national capital in the name of ‘saving democracy’ is a

blatant attempt to save properties worth over Rs 2,000 crore amassed
by the Gandhi family,” said Union minister and senior BJP leader Smriti
Irani. “What would you name this strategy of Congress openly
pressuring an investigation agency?” she asked at a press conference.

Noting that nobody is above the law, she said never before such an
attempt was made by a political family to hold a probe agency to
ransom.
Over 5,000 freedom fighters had shares in the newspaper

when it was floated, and now the Gandhi family owns it,” she said,
adding that the Young Indian was officially formed for charity
purposes in 2010 but it had not undertaken any charitable work in
last six years. “It served not society but the Gandhi family," she said.

Union minister Dharmendra Pradhan said, “Juvenile optics and

resource mobilisation for creating a hostage-like situation for the
investigating agencies will not deviate the spotlight from the
corruption of ‘The Family’.”
“Congress members should also ask Rahul Gandhi about his family’s
relations with Dotex Merchandise, which she described as a hawala
operator whose transactions have been flagged by the Financial
Intelligence Unit,” she said.
Top Congress leaders, workers march in solidarity with Rahul Gandhi
New Delhi, June 13 (PTI): Walking in the blistering summer

heat and raising slogans of solidarity with Rahul Gandhi, Congress

members defied police restrictions as they joined their party leader
when he headed to the Enforcement Directorate office for
questioning in the National Herald case on Monday.

Several workers were detained in the morning when they were on

their way to join the ‘Satyagraha march’ called by the opposition
party, but scores of others gathered at the party headquarters here
by 9 am, holding the national and party flags.
The Congress, which has claimed that the charges against its

leaders in the case are baseless and has accused the Modi
government of political vendetta, dubbed the march as a start of
Mahatma Gandhi’s ‘Satyagraha’ (peaceful resistance). The ruling
BJP, however, criticised the Congress, accusing it of celebrating
corruption.

The opposition party’s march made it through two points of

barricading but was stopped at the third point, where several
prominent leaders, as well as workers, were detained and taken away
in police vans and buses
The ED will record the statement of the Lok Sabha member from
Wayanad in Kerala under criminal sections of the Prevention of
Money Laundering Act (PMLA).

The probe pertained to alleged financial irregularities in the party-promoted

Young Indian that owns the National Herald newspaper. National Herald
was published by the Associated Journals Limited (AJL) and owned by
Young Indian Pvt Limited.

The Gandhis are expected to be grilled about the incorporation of a Young

Indian company, the operations of the National Herald and the fund transfer
within the news media establishment.
 In 2008, National Herald shut down, with a debt of Rs 90.25 crore
owed to the Congress (in 2016, AJL re-launched the three dailies).

 This Rs 90.25 crore was given by the Congress to National Herald as

an interest-free loan.

 In 2010, a year after the Congress-led United Progressive Alliance

(UPA) won the Lok Sabha election, a charitable non-profit organisation
called Young India Limited (YIL) was established. Congress leader
Rahul Gandhi was its director. Apart from him and his mother, Sonia
Gandhi, other shareholders were Congress leaders Motilal Vora and
Oscar Fernandes (Vora and Fernandes have died).
 In 2010, AJL had 1,057 shareholders, including the fathers of former

Union Law Minister Shanti Bhushan and former Chief Justice of the Allahabad

and Madras High Courts Markandey Katju. AJL's holdings were transferred to

Young India in 2011. The Congress assigned the debt owned by AJL to YIL,

which paid Rs 50 lakh to the party.

• YIL got the rights to acquire National Herald's assets, including real estate in
Delhi and elsewhere in the country, and recover the debt from AJL.

 In 2012, Subramanian Swamy moved a Delhi trial court, alleging a National

Herald scam, linking it to Sonia and Rahul Gandhi and others.
 The following is the core of Swamy's allegations: The Gandhis' YIL had a share
capital of just Rs 5 lakh. It took a loan of Rs 1 crore from Kolkata's shell firm Dotex
Merchandise Pvt Ltd and paid the Congress Rs 50 lakh to recover the debt of Rs 90.25 crore

from National Herald.

 But YIL ended up taking over AJL and, by extension, the defunct print media outlet's assets,
including prime real estate in Delhi and across the country, worth over Rs 2,000 crore
maliciously.

 The Congress, run by the Gandhis, waived off the remaining debt of Rs 89.5 crore. The party
had already taken Rs 50 lakh.

 So, the assets of AJL, which had hundreds of shareholders and did not belong to individuals
(the likes of Bhushan and Katju said holdings were transferred without consent), went to the
Gandhis' YIL that had no commercial operations.
 The Congress should have received Rs 90.25 crore. But the party got

 only Rs 50 lakh. Even by the government's account, YIL now has assets of Rs
800 crore across the country.

 Swamy essentially alleged an illegal takeover of AJL and named Sonia Gandhi,
Rahul Gandhi, Motilal Vora, Oscar Fernandes, journalist Suman Dubey and
technocrat Sam Pitroda as accused in his petition to the Delhi court.

 Swamy has said the loan of Rs 90.25 crore itself was illegal as it came from
party funds. Under the Income-Tax Act, no political organisation can have
financial transactions with a third party.
In 2012, Rahul Gandhi's office threatened legal action against

Swamy. The Congress said the Rs 90.25 crore was legal as the party didn't
take interest. The Congress defended the debt swap, saying AJL was a
companion organisation of the Congress, and it was the party's duty to revive
the institution and the newspapers under it. The party has claimed YIL was
created for charity and not any profit. The Delhi trial court issued summons to
Sonia Gandhi and Rahul Gandhi on Swamy's petition. The court said it
appeared that YIL was created as a "sham or a cloak" to convert public money
for personal use. The Delhi High Court stayed the summons. The same year,
the ED began a probe to ascertain money-laundering charges.
In 2015, Swamy moved the S C for speedy investigation but was told to

approach the high court. The Delhi High Court said that the accused did appear
to have "criminal intent". The same year, the ED reopened its investigation after it
was briefly closed due to "technical reasons." Sonia Gandhi and Rahul Gandhi
secured anticipatory bail from the Delhi trial court. In 2016, the S C exempted all
five accused from personal appearances but refused to quash proceedings
against them. In 2018, the Centre decided to end the perpetual lease and evict
AJL from the Herald House premises allotted on Delhi's Bahadur Shah Zafar
Marg in 1962. The government said the ALJ was no longer conducting any
printing or publishing activity for which the building was allotted to it. In 2019, the
S C stayed the eviction proceedings until further notice.
Rahul Gandhi has clocked over 24 hours in multiple question and
answer sessions over the last two days at the ED office. He left at
11:30 pm on Tuesday after being questioned for over 11 hours on day two.
Officials said Gandhi's questioning could not be completed on Tuesday, and
hence, he was asked to continue the recording of his statement on Wednesday.

About 15-16 questions about the incorporation of the Young Indian company, the
operations of the National Herald newspaper, the loan given by the Congress to
the Associated Journals Limited (AJL) and the funds transfer within the news
media establishment have been put to Gandhi during the questioning held till now,
sources indicated.
THE CASE: The ED said that it has recorded statements

of all office-bearers of Associated Journals Limited (AJL), Young India Limited

(YIL), and National Herald (NH). Now, only Rahul Gandhi and Sonia Gandhi
are left to be questioned. Rahul Gandhi and Sonia Gandhi hold 38% shares of
YIL each. According to allegations levelled by politician/lawyer Subramanian
Swamy in 2011, the AJL — a public limited company with immovable assets at
prime location in New Delhi - was shut down in 2008 as it closed printing and
publication of the National Herald. At the time of its closure the AJL owed Rs
90.26 crore to the Congress, which had given loans to the company in order to
keep the National Herald running. The loans were interest-free.
Sources in the Enforcement Directorate (ED) said: Congress leader
Rahul Gandhi, who is being questioned in the National Herald case, put the
onus of entire transaction of takeover of Associated Journals Ltd (AJL) on late
Motilal Vora, former Congress treasurer. Motilal Vora was responsible for all the
transactions related to the Young Indian’s acquisition of Associated Journals Ltd’s
(AJL) assets worth hundreds of crores from the party. Congress’s Motilal Vora died
in December 2020 and was also questioned by the ED in the National Herald case.
Rahul Gandhi on Thursday appealed to the Enforcement Directorate (ED) to
postpone June 17 (Friday) questioning due to the treatment of his mother and party
president Sonia Gandhi.  Rahul, 51, appeared before the ED for three consecutive
days of questioning in the National Herald money laundering case.
New Delhi: The E D has accepted Rahul Gandhi’s request to defer his
questioning in the National Herald money-laundering case from June 17 to
June 20 owing to personal reasons. The Wayanad Congress MP had written
to the investigating officer of the Enforcement Directorate (ED) to allow him
exemption from the questioning scheduled on Friday (June 17) as he wants to
remain with his ailing mother, Sonia Gandhi. Congress president Sonia
Gandhi has been admitted to a private hospital in Delhi due to COVID-19-
related issues. Accordingly, the financial probe agency has asked the
Congress leader to appear before it again on Monday. Meanwhile, Congress
leaders and workers held protests in several parts of the country.
The three days of questioning by the ED has been accompanied by
massive protests carried out by Congress workers and leaders, who allege that
the agency’s action is nothing but vendetta politics of the Bharatiya Janata Party-
led Centre.
On Wednesday, the protests turned highly dramatic and violent when images
emerged of workers and leaders being whisked away and detained by a strong
posse of police, supported by paramilitary personnel in the National Capital.
Congress party workers burnt tyres outside the ED office and the party accused
Delhi Police of entering their party headquarters forcefully and assaulting
workers.
After his gruelling questioning for three days — which began on Monday — the
Congress MP has finally received a breather after ED officials acceded to his
request to defer his questioning in the case from 17 June to 20 June (Monday)
owing to his mother’s hospitalization who is down with Covid.
The ED sought answers about Rahul’s “personal role” in taking decisions with
regard to National Herald and its owner Young Indian. On 13 June_Monday, he
was questioned for10 hours, on Tuesday for over 11 hours. On Wednesday, the
questions lasted for almost eight hours. There was a  massive protest carried
out by Congress workers and leaders, who allege that the agency’s action is
nothing but vendetta politics of the B J P -led Centre.
Congress President Sonia Gandhi is currently being treated for a fungal
infection detected in her lower respirator tract, along with other
post-COVID symptoms. She continues to be under close observation and
treatment, the Congress party issued a statement.
She was admitted to Sir Ganga Ram Hospital, New Delhi on the afternoon of June
12, 2022 when she developed profuse bleeding from the nose following Covid
infection. She was immediately put under treatment and underwent a related
follow-up procedure yesterday morning. A fungal infection in her lower respiratory
tract was also detected upon admission. She is currently being treated for it along
with other post-Covid symptoms. She continues to be under close observation and
treatment.
What is the case?
The ED case is based on a trial court order that allowed the Income Tax
Department to probe the affairs of National Herald newspaper and
conduct a tax assessment of Sonia and Rahul. The order was the result
of a petition filed by BJP MP Subramanian Swamy in 2013.
Swamy's complaint had alleged cheating and misappropriation of funds
on the part of the Gandhis in acquiring the newspaper. Swami had
alleged that the Gandhis acquired properties owned by National Herald
by buying the newspaper's erstwhile publishers, The Associated
Journals Limited (AJL), through an organisation called Young Indian (YI)
in which they have 86 per cent stake.
As Congress vice-president Rahul Gandhi walked into the Enforcement
Directorate (ED) office in New Delhi to be interrogated in a money
laundering case [allegedly] connected to the National Herald newspaper, party-
men including Rajasthan and Chhattisgarh chief ministers Ashok Gehlot and
Bhupesh Baghel, and former Union finance minister P Chidambaram, staged a
protest in the country’s capital. Both the interrogation and its resultant protests
continued for three days. This is perhaps the first time in recent years that the
Congress displayed its political might despite its shrinking electoral base in the
country. It couldn’t have remained a silent spectator when the leaders stood in
the dock in what they believed to be an act of political vendetta. The Bharatiya
Janata Party (BJP) dismissed it as a support for corruption.
1.Rahul Gandhi on Thursday evening reached Sir Ganga Ram Hospital
in Delhi, where he stayed at the hospital to look after ailing mother
Sonia Gandhi. The ED has now issued fresh summons to Congress leader Rahul
Gandhi to join the investigation in the National Herald case on June 20.
2. Gandhi was questioned by the ED for about eight hours on Wednesday, the third
day of his appearance in the National Herald money laundering case.
3. Gandhi (51) left the Enforcement Directorate (ED) headquarters on APJ Abdul
Kalam Road in central Delhi around 9:30 pm.
4. His statement was recorded in multiple sessions under the Prevention of Money
Laundering Act (PMLA) and after Wednesday’s round of questioning, he has clocked
close to 30 hours with the ED investigators.
5. He has been called by the agency for the 4th day
on June 17 as he sought an exemption for Thursday.
The probe pertains to alleged financial irregularities in
Young Indian Private Limited, promoted by the
Congress, that owns the National Herald newspaper.
The newspaper is published by Associated Journals
Limited (AJL) and owned by Young Indian.