Updated: June 2, 2022 5:57:45 am
WEEKS AFTER the Enforcement Directorate (ED) questioned Congress leaders Mallikarjun Kharge and Pawan Bansal in connection with its National Herald money laundering probe, the central agency has summoned the party’s president Sonia Gandhi and Lok Sabha MP Rahul Gandhi to appear before it on June 8 in connection with the case filed six months ago.
The summons drew furious reactions from the Congress, which described the case as “weird” since “no money was involved” and said that the charges were “more hollow than a pack of cards”. “We will face them. We are not a bit scared or overawed or intimidated by such cheap tactics,” the party’s spokesperson Abhishek Singhvi said at a press conference along with the party’s communication head Randeep Surjewala.
Reacting to the Congress’ allegations that the Government was trying to quell the opposition like how the British had tried during the freedom struggle, BJP president J P Nadda said that “documents don’t lie, and documents are permanent and thereby they are being scrutinised”. “The problem is with the face but the mirror is being cleaned,” Nadda told reporters in Bhopal where he is on a three-day visit.
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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 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, AJL, through an organisation called Young India in which they have 86 per cent stake. Sonia and Rahul were granted bail in the case by the trial court on December 19, 2015.
In Swamy’s complaint before the trial court, Sonia, Rahul and others have been accused of misappropriating funds by paying Rs 50 lakh for Young Indian (YI) to obtain the right to recover Rs 90.25 crore that AJL owed to the Congress.
It was alleged that YI, which was incorporated in November 2010 with a capital of Rs 50 lakh, had acquired almost all the shareholding of AJL, which was running National Herald. The I-T department had claimed that the shares owned by Rahul in YI would lead him to have an income of Rs 154 crore and not about Rs 68 lakh, as was assessed earlier. It has already issued a demand notice for Rs 249.15 crore to YI for the assessment year 2011-12.
Earlier, ED had initiated a money laundering probe against AJL in 2018 in connection with a plot allotted to it in Haryana’s Panchkula by then chief minister and Congress leader Bhupinder Singh Hooda. The ED had attached the plot, accusing the company of having acquired it “fraudulently”. Hooda is an accused in the money laundering case registered by the agency in the matter.
The Congress said on Wednesday that the summons for Sonia and Rahul were received “just a few days ago” and Sonia will “100 per cent” appear before the ED. “If Rahul Gandhi is here, he will also go. Otherwise we will seek some time,” Singhvi said.
Singhvi said that AJL had come under financial stress over the decades after which the Congress stepped in and over a period of time gave around Rs 90 crore as financial support.
“So AJL became an indebted company, a company with debt. AJL did what every company in India does…it converted its debt into equity. So this debt of Rs 90 crore was assigned to a new company. It is called Young India so that the books of AJL become debt-free,” he said.
“Young India, in turn, which received the debt, was a newly created company under a special provision of the Companies Act — Section 25 — which has very two vital conditions. It has to be a not-for-profit company by definition, by statute and by law, and no dividend can be given to its shareholders or directors. So you cannot take a penny,” he said.
“The third important facet is that AJL continues to hold all the properties it was holding earlier. It continues to be the owner of National Herald and its printer and publisher. The only change is that Young India is holding the shareholding of AJL… Young India cannot use money in any form which it gets because it can neither pay dividend nor accumulate profit by which it can give out the money,” he added.
Alleging that the case was filed with malafide intent, Singhvi said: “This is why better minds, objective minds, non-malevolent, non-malafide minds closed this case in file but as malafide as this government is, they sack the head of ED at that time, they get a new opinion and they try to reopen in respect of which seven years later today they are summoning the Congress president Sonia Gandhi and former Congress president Rahul Gandhi.”
Senior Congress leader P Chidambaram tweeted: “Money-laundering without money is like alleging purse snatching without a purse. It is like alleging that you were found unauthorisedly swimming in a pool that had no water. You can think of more examples (each one more absurd than the other).”
Hitting back at the Congress, BJP chief Nadda said: “Have you ever seen a thief accepting his crimes? There are criminals who get punished and serve their sentences of 20-20 years and yet say that they had been wrongfully framed. When someone is under scrutiny of law, if he is innocent, he should get the bail and charges will be dropped. Why are they not doing it?”
Incidentally, the ED case has been filed without any “predicate offence” (criminal case) being registered by any other agency. Under the Prevention of Money Laundering Act, the ED is not authorised to register a case of money laundering until another agency or state police has registered an FIR.
“In this case, the Enforcement Case Information Report has been registered based on the court order following Subramanian Swamy’s complaint. The ED is authorised to register a case if there is a court order specifying that a crime has been committed,” an ED official said.
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