Mother and Son duo of Sonia and Rahul Gandhi were dealt a huge blow by the Delhi High Court after it gave a go-ahead for an Income Tax probe into the Young India Private ltd, which is involved in the alleged National Herald scam which amounts to about Rs 5000 crores.
Young Indian has approached the High Court to stay proceedings against it in the National Herald case. The High Court bench in turn asked Young India to approach the Income Tax assessing officer, after which the company withdrew its petition, and hence the High Court dismissed the plea clearing the path for the probe.
Before we go ahead, let us quickly recall the facts of the National Herald case, how the Gandhis are involved in the whole thing, and why the Income Tax probe may be a huge blow for them.
National herald was a newspaper which was founded by Nehru in 1938 and ceased normal operations in 2008. During this time, the paper mainly acted as the official mouthpiece of the party.
When the paper ceased normal operation in 2008, its parent company Associated Journal Limited (AJL) had a debt of 90 crores.
According to Subramanian Swamy who is the main petitioners against Young India, in 2011 a firm called Young India limited was created by Sonia and Rahul with a paid up capital of about Rs 5 lakh. In the company Sonia and Rahul each reportedly hold a 38% stake.
The new company then passed a board resolution that they would offer AJL a structure that it would arrange loans to wipe off all its debts. This in itself raises eyebrows as AJL was the owner of various prime real estate properties which amounted to a total of anything between Rs 1600 crores and Rs 5000 crores, hence the debt should never have been a problem in the 1st place.
Now apart from Sonia and Rahul, Oscar Fernandes and Motilal Vora too reportedly held equity in Young India and incidentally the Chairman of AJL was also Motilal Vora, which is a case of conflict of interest.
Swamy further alleged that in-return of Young India clearing all the debt of AJL, the latter would transfer all its shares to Young India (which means Young India will own all the Rs 5000 crore real estate properties).
It was further alleged that AJL was given an interest free loan by the Congress party at the direction of the treasurer who incidentally also was Motilal Vora.
What added another dimension to the whole story was the fact that after Young India took control of the National Herald’s properties, it rented out the Press Area property at about 60 lakh per month for various government services.
So to sum it up, after paying up just 5 lakh to form Young India, Sonia and Rahul allegedly managed to acquire about Rs 5000 crore worth of properties of National Herald and considering their shares in Young India, they each allegedly earned assets worth Rs 1900 crores. Plus they allegedly earned a rent of about Rs 60 lakh per month for renting out the press area property.
Now as a stay on the Income Tax probe has been denied by the High Court, all the allegations surrounding the case may soon end up becoming facts and Sonia-Rahul could be asked to pay taxes or penalties. It can further attract penalties on the party as a political party is not supposed to indulge in commercial activities.
The probe incidentally was ordered by the Patiala House Court, against which Young India had appealed in the High Court. So they may now appeal further in the Supreme Court hence there may be some time before the probe actually gets completed.
Also as a footnote, National Herald was revived by Rahul Gandhi in a digital avatar in November 2016 and it soon ended up in a controversy when it was exposed by people for publishing blatant lies.