Congress Leaders Committed ₹90 Cr Criminal Breach Of Trust In "Sham" AJL-Young Indian Deal: ED Tells Delhi Court
"AICC was given funds, which were to be used properly, but the way they used ₹90 crore shows that they have committed criminal breach of trust," ASG Raju told the Court during the hearing;
During the hearing in the National Herald case, the Enforcement Directorate (ED) on Tuesday accused top Congress leaders, including Sonia Gandhi and Rahul Gandhi, of criminal breach of trust and money laundering, alleging that the takeover of Associated Journals Limited (AJL) by Young Indian was a fraudulent transaction designed to usurp assets worth over Rs. 2,000 crore.
Appearing before Special Judge Vishal Gogne of Rouse Avenue Court, Additional Solicitor General (ASG) S.V. Raju, for the ED, argued that the Rs. 90 crore loan given by the All India Congress Committee (AICC) was misused and amounted to criminal breach of trust.
"AICC was given funds, which were to be used properly, but the way they used ₹90 crore shows that they have committed criminal breach of trust," Raju told the Court during the hearing.
The ASG further informed that the transaction between AJL, the publisher of the National Herald newspaper, and Young Indian, a private company controlled by the Gandhis, was nothing but a “sham transaction.” “The entire arrangement was a facade to gain control over AJL's properties,” he argued, adding that his submissions would continue on July 12.
Accordingly, further arguments in the matter are scheduled for July 12.
Previously
On the last hearing, Young Indian Private Limited had contended that the Income-Tax Department categorically labelled the purported Rs. 90 crore loan to Associated Journals Ltd (AJL), publisher of the National Herald, as a sham transaction, noting that “monies never flew.” The petitioner-private company had argued that this stance directly conflicts with Enforcement Directorate’s (EDs) core allegations and raises fundamental doubts over the money laundering charges.
It is to be noted that on July 4, Senior Advocate Abhishek Manu Singhvi, representing Sonia Gandhi had described the Enforcement Directorate’s (ED) money laundering case against her and other Congress functionaries in the National Herald matter as “truly a strange” and unprecedented prosecution. “This is truly a strange case. More than strange. Unprecedented. This is an alleged case of money laundering without any proceeds of crime, without property, without use or projection of property,” Singhvi had argued, calling into question the very basis of the ED's case under the Prevention of Money Laundering Act (PMLA).
On May 21, the Delhi Court had began hearing arguments on the cognisance of a prosecution complaint filed by the Enforcement Directorate (ED) against Congress leaders Sonia Gandhi, Rahul Gandhi, and others in connection with a money laundering case linked to the National Herald matter.
Additional Solicitor General (ASG) S.V. Raju, appearing for the ED had opened the submissions by asserting that a prima facie offence of money laundering is made out against the accused. He had said the case involves generation of proceeds of crime through continuous criminal activity, which satisfies the ingredients of the offence under the Prevention of Money Laundering Act (PMLA).
ASG Raju had submitted that the complaint, filed under Sections 44 and 45 of the PMLA, has been lodged against seven accused persons, including Sonia Gandhi, Rahul Gandhi, Sam Pitroda, Suman Dubey, and Young Indian. He also informed the Court that property attachments in the case were made in November 2023, and until then, the accused continued to enjoy the proce
Earlier, on May 8, the Delhi Court had adjourned proceedings in the case. “Since the notice has purportedly been served upon an alternative email ID upon the proposed accused 4 (Sam Pitroda) only today, it is appropriate that submissions on the aspect of cognisance are heard on the next date of hearing,” the Court had observed.
On May 2, the Delhi Court had issued notices to Congress leaders Sonia Gandhi and Rahul Gandhi in the National Herald money laundering case, observing that their “right to be heard at any stage breathes life into a fair trial.” The Special Judge of Rouse Avenue Court had noted that the right of the accused to present their side was available at the time of cognisance of the chargesheet filed by the Enforcement Directorate (ED).
Background
The ED had recently filed its prosecution complaint (chargesheet) in the case, which stems from a private criminal complaint originally filed by BJP leader Dr. Subramanian Swamy before a magistrate court on June 26, 2014. That complaint prompted the initiation of the financial probe in 2021, with the ED alleging large-scale money laundering involving key Congress figures.
According to the ED, the case involves a “criminal conspiracy” in the alleged fraudulent takeover of assets worth over Rs. 2,000 crore belonging to Associated Journals Limited (AJL), the publisher of the now-defunct National Herald newspaper. Among those named in the conspiracy are Congress Parliamentary Party Chairperson Sonia Gandhi, her son and senior party leader Rahul Gandhi, the late Congress leaders Motilal Vora and Oscar Fernandes, as well as Suman Dubey, technocrat Sam Pitroda, and the private company Young Indian.
The Central agency has alleged that Young Indian, a company formed in 2010, acquired 100% of AJL's shares through a series of transactions that involved financial irregularities and violations under the Prevention of Money Laundering Act (PMLA). Sonia Gandhi and Rahul Gandhi each hold a 38% stake in Young Indian, effectively giving them majority control. The ED has accused the Congress leadership of misusing party funds and instrumentalising Young Indian to acquire valuable AJL properties, originally intended for journalistic purposes, for commercial benefit. As part of its investigation, the ED had previously summoned and questioned both Sonia Gandhi and Rahul Gandhi for several hours.
With the issuance of notice, the Delhi court has now formally involved the Gandhis in the current stage of proceedings, where the ED's chargesheet awaits judicial consideration. The court's order reinforces the importance of adhering to principles of natural justice by ensuring that the accused are given an opportunity to be heard before any further action is taken. The matter will be heard again on May 8.
Case Title: Directorate of Enforcement v. Sonia Gandhi & Ors.
[Inputs: The Hindu]