Congress created firm to launder money to avoid its direct name in news headlines: ED to court

Indian Express

2 days ago

The Enforcement Directorate (ED) told a Delhi court Thursday that the Congress created a company called Young Indian to allegedly launder money worth Rs 2,000 crore from Associated Journals Ltd. (AJL) — the company which used to publish the National Herald newspaper — to avoid its 'direct name' appearing in news headlines.
Additional Solicitor General S V Raju, who appeared for the agency, made these submissions before the court of Special Judge Vishal Gogne while it was hearing arguments on the point of cognizance of the chargesheet filed against senior Congress leaders Sonia Gandhi and Rahul Gandhi in the National Herald money laundering case.
The ED's case is that the Congress provided an interest-free loan of Rs 90 crore to AJL, which had assets worth Rs 2,000 crore, for a 'consideration of just Rs 50 lakh'. As per the ED, this debt, which AJL overtook, was allegedly converted into equity in favour of the not-for-profit company Young Indian (YI), in which Sonia and Rahul Gandhi held a majority 76% stake.
'… such a crucial decision of vesting 99% shareholding of AJL with Young Indian was taken by only 7 members, including the two accused (Sonia and Rahul Gandhi)… there were a total of 1,089 shareholders who weren't consulted. This shows that the whole thing was a fraud,' Raju, who was accompanied by Special Counsel Zoheb Hossain and Special Public Prosecutor NK Matta, told the court.
'They've (Congress leaders) deprived the shareholders of AJL of their right. Young India invested just Rs 50 lakh and got Rs 2,000 crore. YI gained wrongfully and the shareholders suffered,' he added.
'From 70% ownership, the shareholders of AJL dropped to 2%. Nobody in their right mind would agree to this. There can't be a bigger fraud than this,' the ASG submitted.
Special Judge Gogne then asked Raju, 'Are the shareholders also witnesses in this case? This is a little peculiar… so shouldn't they also be made witnesses? The ED has not investigated the 1,000 shareholders. So will this trial go on without them being witnesses?'
Raju replied: 'The record speaks for itself. This is a classic case of money laundering… the real culprits are these 7 persons, once you pierce the veil… Today, Sonia and Rahul Gandhi hold almost all shares. They're the beneficial owners of the company.'
Other than the Gandhis, the ED has also named Congress leaders Suman Dubey and Sam Pitroda as accused in the case. Along with this, firms Young India and Dotex Merchandise Pvt. Ltd have also been named.
The case originated in 2012 from a criminal complaint filed by the then-BJP Rajya Sabha MP, Subramanian Swamy, against the Gandhis and other leaders of the Congress, where he had accused them of fraud in acquiring AJL's property.
In its chargesheet, the ED alleged that YI, which was incorporated in 2010, had the same set of people appointed at various positions as AJL. The Rs 90 crore loan was converted into equity after AJL stated that they wouldn't be able to repay it, alleged the ED.
Via this conversion of the loan into equity, claimed the agency, YI, a loss-making company, got 99% ownership of AJL, a company with assets worth Rs 2,000 crore. With the transfer of these shares, the assets of AJL also got transferred to YI, whose beneficial owners were Sonia and Rahul Gandhi, the ED claimed.
While the ED has completed its arguments on the cognizance of the chargesheet, senior advocates Abhishek Manu Singhvi and RS Cheema are likely to argue on behalf of the Gandhis on Friday.