Sonia, Rahul face court date

Sonia, Rahul

R.Balaji, TT, New Delhi, Dec. 7: Delhi High Court today found prima facie evidence of "criminal intent" against Sonia Gandhi and Rahul Gandhi, accused of fraudulently acquiring the closed newspaper "National Herald", and dismissed their plea challenging a trial court's summons.

The Congress denied this was a political setback and is believed to be gearing to move the Supreme Court tomorrow to have the single-judge bench's order stayed.

As matters stand, the Gandhis and five other accused - Motilal Vora, Oscar Fernandes, Suman Dubey, Sam Pitroda and Young India Ltd - are to tomorrow appear in the trial court, whose August 2014 summons the high court refused to stay any further.

Complainant Subramanian Swamy of the BJP has already moved a caveat in the apex court pleading he be heard before any order is passed.

Justice Sunil Gaur, in his verdict, said: "This court is of the considered view that the gravity of the allegations levelled against the petitioners has a fraudulent flavour involving a national political party and so, serious imputations smacking of criminality levelled against the petitioners need to be properly looked into."

Swamy has alleged that the Gandhis, through the company Young India Limited they had floated, had acquired the daily - whose assets he claims are worth Rs 5,000 crore - by paying just Rs 50 lakh from the Congress's funds.

He says the publisher, Associated Journals Limited (AJL), had closed its operations in 2008 with an unpaid debt of about Rs 90 crore, and that Young India (YI) gave it an interest-free loan to clear its debts although the company could have done so by selling a part of its assets. Sonia and Rahul are among the directors of YI.

Vora, the Congress treasurer, was managing director of AJL and later became a shareholder of YI, Swamy has said. He has said that YI acquired all the equity in AJL and rented out its properties to benefit its shareholders, including Rahul and Sonia, who he says together control 76 per cent stake.

Justice Gaur has pegged the worth of AJL's assets at Rs 2,000 crore.

"This court finds no hesitation to put it on record that the modus operandi adopted by the petitioners in taking control of AJL via a special purpose vehicle i.e. YI, particularly, when the main persons in the Congress party, AJL and YI are the same, evidences a criminal intent," he said.

"Questionable conduct of the petitioners needs to be properly examined at the charge stage to find out the truth and so, these criminal proceedings cannot be thwarted at this initial stage."

He added: "However, it has to be kept in mind that the allegations against the office-bearers of the Congress party are of siphoning off the party funds in a clandestine manner. What crops up in the mind of a prudent person is as to where was the need of extending interest-free loans to a public limited company engaged in a commercial venture of publishing newspapers.

"Considering the fact that AJL has sizeable assets of Rs 2,000 crore, it needs to be explained by the petitioners as to what was the need to assign the huge debt of Rs 90 crore when this debt could have been easily liquidated by AJL from its sizeable assets.

"Even writing off such a huge debt by the Congress party can legitimately attract allegations of cheating, fraud, etc. The petitioners had gone a step further in conspiring to get this huge debt assigned to a special purpose vehicle i.e. YI and, thereafter, to hijack AJL via YI."

He added: "Is it not criminal misappropriation of the Congress party's funds?... It also needs to be examined at the pre-charge stage as to whether lakhs of citizens who had donated to the Congress party felt cheated by assignment of such a huge debt to YI who was managed by none others than the petitioners, who were office-bearers of the Congress party as well as directors of YI.

"Not only this, the main persons, who were instrumental in allegedly siphoning off political funds were the recipients of the assignment of the huge debt by the Congress party and they were the same persons who had clandestinely acquired the control of AJL. All this smacks of criminality."