India's Enforcement Directorate on Tuesday attached assets of the National Herald newspaper, worth Rs 752 crore, in connection with an ongoing money laundering investigation into the publication and the companies linked to it. These assets include the paper's offices in the national capital's ITO area, as well as the Nehru Bhawan in Lucknow and the Herald House in Mumbai.
The Congress-backed publication has been subject to the money laundering investigation after a 2014 court order from the Metropolitan Magistrate of Delhi that took cognisance of a private complaint against alleged irregularities in the National Herald's affairs.
National Herland's parent company Young Indian and its publisher Associated Journals Limited (AJL) are both part of the provisional attachment order issued by the agency under the Prevention of Money Laundering Act (PMLA). Congress leaders Sonia and Rahul Gandhi are majority shareholders of Young Indian, with each of them holding a 38% stake.
Under the law, such a provisional order has to be approved by the Adjudicating Authority of PMLA in a time period of six months following which the ED can take possession of the attached properties.
Tuesday's order comes even as Assembly elections take place in five states - Chhattisgarh, Madhya Pradesh, Rajasthan, Telangana and Mizoram - two of which have incumbent Congress governments. Votes for all five polls are set to be counted on December 3.
The Congress termed the ED's move as a 'petty vendetta' and dubbed the agency a 'coalition partner' of the BJP. The federal probe agency's statement alleges that the shareholders and donors of the Congress were 'cheated' by AJL and the party.
"Investigation revealed that Associated Journals Ltd. (AJL) is in possession of proceeds of crime in the form of immovable properties spread across many cities of India such as Delhi, Mumbai and Lucknow to the tune of Rs. 661.69 crore and Young Indian (YI) is in possession of proceeds of crime to the tune of Rs. 90.21 crore in the form of investment in equity shares of AJL," the agency order said.
The Gandhis, Congress president Mallikarjun Kharge and party leaders Pawan Bansal, D K Shivakumar (Karnataka deputy chief minister) and his MP brother D K Suresh were questioned and their statements were recorded by the agency in connection with the case last year.
The 2014 court order had held that seven accused persons and entities, including Young Indian, prima facie committed offences of criminal breach of trust under various sections of the IPC, including cheating and dishonestly inducing delivery of property, dishonest misappropriation of property and criminal conspiracy, the ED said.
"The accused persons hatched a criminal conspiracy to acquire properties worth hundreds of crores of AJL through a special purpose vehicle — Young Indian. AJL was given land on concessional rates in various cities of India for the purpose of publishing newspapers," the agency said.
The agency alleges that AJL closed its publishing operations in 2008 and started 'using' the properties for commercial purposes. It said AJL had to repay a loan of Rs 90.21 crore to All India Congress Committee (AICC), however AICC treated the said loan of Rs 90.21 crore as non-recoverable from AJL and sold it for Rs 50 lakh to a newly incorporated company Young Indian 'without any source of income.
"By their action, the shareholders of AJL as well as donors of Congress Party were cheated by the office bearers of AJL and Congress Party," the agency claims. After purchasing the loan of Rs 90.21 crore from AICC, YI demanded either re-payment of loan or allotment of equity shares of AJL to it, the ED said.
AJL, it added, held an Extraordinary General Meeting (EGM) and passed a resolution to increase share capital and issue fresh shares worth Rs 90.21 crore to YI. "With this fresh allotment of shares, shareholding of more than 1,000 shareholders was reduced to a mere 1 per cent and AJL became a subsidiary company of YI. YI also took control over properties of AJL," the agency said.
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