The Delhi High Court has ordered the Associated Journals Limited (AJL), the publisher of National Herald news paper, owned by Rahul Gandhi and Sonia Gandhi with majority shareholding in AJL, to vacate the premise of Herald House. A two-judge bench has upheld the single-judge verdict of December 21, 2018.
The Central government had ended the lease of AJL in October 2018 and had served an eviction notice under the Public Premises (Eviction of Unauthorised Occupants) Act, 1971.
Back ground of National Herald Case:
- AJL was formed as a public limited company on on 20 November 1937 with the support of 5000 freedom fighters, who became its shareholders.
- AJL had a capital of Rs 5 lakh, consisting of 2000 preferential shares of Rs 100 each and 30,000 ordinary shares of Rs 10 each.
- AJL was supposed to be engaged only in news.
- The number of AJL’s shareholders stood at 1057 in 2010 as per the company’s documents
- Until 2008, AJL published the National Herald newspaper in English, Qaumi Awaz in Urdu and Navjeevan in Hindi.
- Over the years AJL acquired real estate properties worth about Rs 5,000 crore (reportedly) in several cities, including New Delhi, Lucknow, Bhopal, Mumbai, Indore, Patna and Panchkula.
- Motilal Vora became the chairman and the managing director of AJL in 2002. He was also the treasurer of Congress Party at that time.
- Congress Party lent an unsecured loan of Rs 90 crore to AJL, as the latter was incurring losses.
- In 2010 a company called Young Indian was floated with capital of Rs 5 lakh. It’s registered office address was same as that of AJL (5A, Herald House, Bahadur Shah Zafar Marg, Delhi.)
- After a month Rahul Gandi was appointed YI director and later Sonia Gandhi joined the board of directors. The duo hold 76$ of YI shares. The remaining 24% share is held by Motilal Vora and Oscar Fernandes.
- In February 2011, AJL approves transfer of all of its shares (9 crore) to YI for Rs 50 lakh, to supposedly clearing the Rs 90-crore loan.
- In effect YI paid Rs 50 lakh to get Rs 90-crore worth AJL shares and Rs 5000 worth AJL’s properties.
Timeline of legal battle:
- November 2012: Dr Subramanya Swamy filed a criminal complaint in a Delhi court.
- June 2014: Gandhis summoned as accused by the court.
- August 2014: Delhi HC stays proceedings of the case. Enforcement Directorate (ED) begins preliminary examinations.
- August 2015: ED closes the case citing lack of substantive evidence.
- January 2015: Swamy approaches SC, which asks him to make out a case for speedy trial in HC.
- December 2015: Sonia, Rahul, and others get bail.
- February 2016: The SC refuses to quash proceedings, but grants the accused exemption from personal appearances
- July 2016: The Delhi HC sets aside the trial court judgment that permitted the examination of balance sheets and other documents of AJL, YI and the Congress party.
- May 2017: The Delhi HC allows Income Tax department to investigate the alleged misappropriation of funds.
- December 21, 2018: Delhi High Court orders AJL to vacate the premises of ITO. The court also says 99% of AJL’s shares were clandestinely transferred to YI. AJL challenges the single-judge verdict.