Commercial use of AJL properties aimed at furthering company’s cause: Oscar Fernandes

AICC loaned Rs 90 crore to Associated Journals Limited (AJL). Can a political party give such loans?

It is a party paper. If the paper is in difficulty, the party supports the paper. The matter was taken up with the Election Commission, which cleared it.

Who took up the matter with the Election Commission?

I will not be able to speak on these technicalities. The Election Commission has given its verdict. What more do you need?

So this loan was not in violation of rules?

The newspaper wanted to wind up. You cannot wind up an establishment under the labour laws. So we had to pay the emplyees’ salary, their provident fund contributions. And not Rs 90 crore in one day, AICC supported the company whenever it was required.

Did the AICC try to recover that money?

It was a party paper, so there was no need to recover the money. If there is a need, the party will get the money back. But National Herald is not in a position to pay it.

And AICC subsequently wrote off the loan.

I won’t able to answer questions on technicalities, accounting. You can talk to (Motilal) Voraji.

But as a shareholder of AJL, did the management inform you or seek your approval for the equity transfer?

Nothing happens without the consent of the board.

But were all shareholders of AJL informed? Many have stated they had no clue.

In every company there is a secretary. The secretary has to do all these.

What was the need for forming Young Indian when the Congress was supporting AJL?

The basic idea was to have a non-profit organisation to further the cause.

But AJL too was a non-profit company. Then?

I said I will not discuss technicalities… You have to further the cause of the youth. In that spirit, a decision was taken to have a company named Young Indian.

It has been alleged that Associated Journals had many shareholders. But Young Indian has only a handful of shareholders including you and the Gandhis.

If a single rupee has been drawn by any individual for personal benefit, I surrender. Here it is for a public cause. If somebody questions the motive, I am sorry.

But what about the commercial angle? A commercial building has come up on AJL’s land in Mumbai. You get rent from the Herald building on the Bahadur Shah Zafar Marg in Delhi?

It is not commercial. When we started the discussion, you said AICC loaned Rs 90 crore to AJL. Why? If you want to maintain a newspaper, you will have to invest and to further the cause of the company. Which newspaper company, if they have excess land, will not try to derive income out of it?

But those are private companies. And there is no paper now?

It is going to be started.

This rental income, you are saying, will form part of the capital for launching the paper?

For the paper. We have lots of debts to be paid.

But how do you justify construction of a commercial building on AJL land in Mumbai?

These are all to further the cause of either AJL or Young India. If the money is being diverted for any other purpose, you can tell us.

When Young India was formed, was a fair valuation of AJL’s assets carried out?

You are not going to transfer the property from one to the other. It is an asset of the institution, asset that helps you to further the cause with which you started it.

Why didn’t AJL mortgage its assets and property to get out of the debt?

There is no question of mortgaging. These are leased properties. We have admitted that we have borrowed, we have admitted that we don’t have money. If we raise resources to cover the expenditure, what is wrong in that.

So you get the rent, for instance, from the Herald House?

Whether I get it or not, what is wrong in it if it is permitted under law?

Motilal Vora is a director in both AJL and Young Indian and also the treasurer of the AICC. How do you justify that?

These are three institutions.

But the person is the same.

Running AICC is running a political party. He has been given the role of treasurer by the leadership. He doesn’t do anything on his own. He implements the party’s decision. There is no contradiction, it is coordination. I was general secretary of the party and I am a trustee of AJL and Young Indian.

Did the AJL or Young Indian submit a report to the AICC on why National Herald can’t be revived? Was there any assessment?

We never said it cannot be revived. We are going to revive it. For a political party what study you have to conduct, we take a decision.

AJL allotted 9 crore shares to Young Indian in lieu of the loan and Young Indian got 99 per cent of the paid up capital in AJL. Was a valuation done?

All that will be answered in the court. Which political party doesn’t have a paper!

But here a political party has essentially become five-six people.

I admit all you say, provided there is a motive in these five people to deviate from the original cause.

But the High Court has spoken of criminality. You are facing grave charges.

The ultimate authority has to say we have done this. If you see the original charge sheet, it was almost like a judgment. Let us face the facts. If we are at fault, we will be penalised.

When can we expect National Herald to come?

As early as possible.