NEW DELHI: The Associated Journals Ltd, publisher of the National Herald newspaper, had become almost defunct by 2008 when its owners, Congress party, decided to cease the printing and publishing business and started exploring commercial options by renting out AJL’s properties situated at prime locations in Delhi, Mumbai, Panchkula, Lucknow and Patna.
These properties were acquired over the years with the help of Congress governments in the states in which these cities are located at paltry sums for the specific purpose of printing and publishing newspapers.
Then a new entity, Young Indian, which was incorporated in November 2010 by Sonia Gandhi, Oscar Fernandes and some other close friends, entered the scene. It had only Rs 5 lakh in share capital when it came into being. Soon, however, a loan of Rs 1 crore was obtained allegedly from a Kolkata-based shell company so that it could enter into a transaction with the Congress party for the takeover of AJL and all its assets. Sonia Gandhi and her two children, Rahul and Priyanka, are today majority shareholders of Young Indian.
Going by the Enforcement Directorate’s preliminary probe, the company controlled by the Gandhis, which started off with just Rs 5 lakh, now owns properties worth Rs 800 crore across the country. Currently, a passport office works out of its prime property in Delhi — Herald House — located on Bahadur Shah Zafar Marg, near the ITO.
The Panchkula land allotted to AJL, after the ED attached it in a money laundering case, has been conservatively estimated to be worth Rs 65 crore.
The details of AJL and Young Indian are also part of a 2017 assessment report filed by the income tax department before the Delhi high court challenging the takeover of AJL by Young Indian. The high court validated the tax department’s charges and allowed it to reopen the I-T returns of Sonia and Rahul Gandhi, the majority shareholders of Young Indian.
Young Indian was a Section 25 company, exempted from paying tax being a charitable non-profit organisation. It applied for I-T exemption on March 29, 2011 when Congress-led UPA was in office and was granted to it on May 9, 2011 “with effect from the year 2010-11” — which means the new company got tax exemption even for the time when it did not exist and could not have applied for the benefit.
Young Indian has been struggling to keep its control over its prized properties, including the Herald House which is estimated worth hundreds of crores. The ministry of housing and urban development has cancelled the lease deed of Herald House citing violation of the allotment clause where the assessee was found using the property for commercial gains instead of publishing newspapers. The Gandhi family challenged the order before the Delhi HC which dismissed the writ. The possession of the Panchkula property has already been granted to the ED through confirmation of its attachment order.
The period around 2010 saw politicians, industrialists and high networth individuals invest in high-end properties by taking over a company that owned the asset, simply changing its shareholding and directors, instead of going for outright purchase as that would have involved payment of stamp duty and capital gain tax to the exchequer. (Times of India)
