National

Rahul Gandhi To Appear Before ED Today In National Herald Case; Congress Hits Out At Centre

Rahul Gandhi will appear before the ED on Monday, several weeks after he was earlier summoned on June 1 in connection with the National Herald case.

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Congress leaders Sonia Gandhi and Rahul Gandhi.
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Congress leader Rahul Gandhi will appear before the Enforcement Directorate (ED) on Monday, June 13, in the National Herald case. Congress interim president Sonia Gandhi, who was hospitalised with Covid-19-related issues, is slated to appear before the central agency on June 23. 

On June 1, the ED summoned Gandhi in an alleged money-laundering case in connection with the National Herald-Associated Journals Ltd deal. Gandhi was asked to appear before the court earlier. However, he was outside the country and Sonia Gandhi sought some more time from EC due to her illness. 

Meanwhile, several Congress leaders hit out at the BJP, including senior leader P Chidambaram, who accused the ED summons as 'baseless'. The opposition accused the ruling BJP of conducting vendetta politics. 

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What is the National Herald case?

The National Herald newspaper was started by India's first Prime Minister Pandit Jawaharlal Nehru in 1938 from Lucknow. It was part of the independence movement against the British.

Associated Journals Limited (AJL), which published National Herald along with Qaumi Awaz in Urdu and Navjeevan in Hindi, did not belong to any one person but was founded in 1937 with 5,000 other freedom fighters as its shareholders, as per Business Standard. There were 1,057 shareholders in 2010. 

Subramanian Swamy in 2012 filed a complaint alleging some Congress leaders, including the Gandhis, were involved in cheating and breach of trust in the acquisition of Associated Journals Ltd (AJL) by Young Indian Ltd (YIL) in 2011, as per a Business Standard report.

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Sonia and Rahul Gandhi owned 76 per cent of YIL and the remaining 24 per cent was owned by Congress leaders Motilal Vora and Oscar Fernandes.

AJL published the National Herald newspaper in English, Qaumi Awaz in Urdu, and Navjeevan in Hindi until 2008, when it was shut down in 2008 after running into losses. 

The Congress party granted a Rs 90 crore interest-free loan to the AJL to help it, but it could not be revived, and AJL failed to repay the loan to the Congress, according to The Financial Express. 

Under the Income Tax Act, no political organisation can have financial transactions with a third party, notes a Rediff News report.

In 2010, AJL declared the loan cannot be paid and transferred the loan to YIL. In lieu of it, AJL also issued its shares to YIL, giving YIL control of 99 per cent of AJL and its real estate assets, as per Rediff News. YIL paid a further consideration of Rs 50 lakh to AJL.

The report added that the Congress party wrote off the loan given to AJL as unrecoverable.

This meant, as per the complaint, that YIL ended up having the control of AJL and its real-estate assets for Rs 50 lakh on a Rs 90 lakh loan that Congress party wrote off. 

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Swami alleged that YIL had "taken over" the assets of the National Herald in a "malicious" way. 

Some AJL shareholders, such as former law minister Shanti Bhushan and former Allahabad High Court Chief Justice Markanday Katju, said their shares in AJL were transferred to YIL without their knowledge.

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