National Herald Case

The riveting National Herald Case that gave Congress another reason to stall the functioning of the Parliament yet again has drawn everyone’s attention, and why not? What with Congress members bawling slogans like “Down with dictatorship… Vendetta politics wont work.’ Sonia Gandhi stating that ‘I am the daughter-in-law of Indira Gandhi, I am not scared of anyone.’ The statement is ironic in itself given Indira Gandhi’s record with law.

Finance Minister, Arun Jaitley slammed the Congress for holding democracy to ransom just because the High Court dismissed their case. He said all they have to do is either face the trial or appeal in a higher court. This has nothing to do with the functioning of the Parliament. Him trying to explain this in the Parliament over the opposition leaders’ unending bellows of slogans against the ruling party’s supposed ‘vindictive politics’ made for a perfect scene straight out of a movie.

So, what is this case that has created a logjam in the Parliament and has hindered the passage of the much-awaited important bills like GST that too, just when there seemed to be a thaw in the relationship between Congress and BJP.

National Herald and its History:

National Herald is an Indian newspaper established on 9th September, 1938 by Jawaharlal Nehru at Lucknow. It was one of the largest circulated newspapers in Uttar Pradesh in 1960s and 1970s. It was one of the most influential and popular papers. National Herald’s chief editor was Chalapati Rao and the Managing Director was Feroze Jahangir Gandhi, Indira Gandhi’s husband. After running successfully for 70 years, it went into closure as it was running into losses for several years due to overstaffing, and lack of advertisement.

Associated Journals Pvt. Ltd. (AJL) was set up by Jawaharlal Nehru in 1937 and was the company that published National Herald, Navjivan, Quami Awaz newspapers and the international weekly magazine, which are now defunct as the company suffered financial difficulties. However, in 2009, National Herald mysteriously resumed publication in Indore without the Congress being aware of it. When asked, the editor, Sunil Salve said that since land had been allotted to the paper, they revived National Herald.

However, when Motilal Vohra, the Congress Party treasurer, CMD of AJL and Director and shareholder of Young India Pvt. Ltd. was asked about the paper’s resumption in Indore in 2009, he answered in a rather confounded way that ‘everyone already knows that we have ceased the operations last year.’ Right up until 2012, there were contradictory statements made on whether National Herald would be revived.

Controversy surrounding National Herald:

It is to be noted that the ground zero reason for this controversy is Young Indian (YI), which was formed in 2002 as a platform for young Indians with Congress President Sonia Gandhi, Vice-President Rahul Gandhi, Congress leaders Motilal Vohra and Oscar Fernandes as Directors of the Company with Rahul and Sonia Gandhi having 75% ownership.

Just a month after it was set up, Young Indian Board of Directors passed a resolution to own National Herald’s outstanding debt of 90.25 crores received from Congress by AJL in lieu of which AJL issued shares to YI and YI achieved an astounding 99% of AJL.

The question was why couldn’t AJL use its own assets for commercial rent, which is now the property of YI to repay the loans. Also, there were reports in 1980s about how two publication groups in Madhya Pradesh, Amrit Sandesh and National Herald were receiving extraordinary preferential treatment in allotment of prime land from government led by then chief minister Motilal Vohra.

Case against Congress leaders:

Therefore, in 2013 Subramaniam Swamy filed a case against Sonia Gandhi, Rahul Gandhi, their companies and associated persons in Delhi High Court. He alleged that YI, which is a private company founded by Congress leaders was transferred AJL’s debt for a consideration of 50lakhs paid to AJL. In the process it gained 99% ownership of AJL along with the properties that belonged to AJL. He alleged that YI was a sham to grab herald house – a property worth Rs. 1,600 crores, In addition, Herald owns properties across various cities like Mumbai, New Delhi, Lucknow, Indore, Bhopal etc.

AJL could have repaid its loan on its own by making use of its 2000 crores asset, however, the assets were transferred to YI, a private limited company with Congress leaders being majority stakeholders. Swamy, therefore, alleged Rahul and Sonia Gandhi of grabbing assets of a public limited company by forming a private company and using congress party funds. Also, as per Income Tax Act, political parties are debarred from funding business operations. The case was about conversion of loan into equity of a private company in the form of real estate properties in several cities.

Hence, in June 2014, the trial court summoned Sonia Gandhi, Rahul Gandhi, Motilal Vohra and Oscar Fernandes and said that formation of YI in fact appears to be a sham to convert public money to personal use and gave the accused persons an opportunity to refute the allegations against them. On 30 July, 2014, Congress leaders moved the High Court which stayed the summons. The High Court dismissed their appeals stating that the case prima facie evidenced criminality. It observed that the reasons for grant of loan to AJL, modus operandi of transfer of loan to YI, and related transactions have to be closely observed by the trial court.

The Congress continuously justified that YI was created for charity and not for profit. Even though they claimed that there was no illegality in any transaction as it was merely a commercial transaction involving transfer of shares, the bench of Sunil Gaur said that the Congress’s transactions with AJL and YI do not appear to be only commercial transaction as they legitimately attract allegations of fraud, cheating, breach of trust and misappropriation which needs to be thoroughly probed into.

On 19th December, all the accused in the case got bail. Both Sonia and Rahul Gandhi have got bail on a personal bond of Rs. 50,000 each and the next hearing in the case is posted for February 20th.

Subsequently on February 11th, Supreme Court agreed to hear Rahul and sonia Gandhi’s plea against Delhi High Court’s verdict refusing the quash the summons issued to them. The Supreme Court then declared on 13th February that it found no justification to in quashing the criminal prosecution and ordered the trial to proceed.

On March 12, Metropolitan Magistrate accepted Subramanya Swamy’s plea and summoned the balance sheets of INC and AJL. On May 6th, 2016, Swamy seems to have found another breakthrough as he said that he has found witnesses who would depose against Congress President Sonia Gandhi and Vice President Rahul Gandhi. He shall submit the list of witnesses on July 16th. However, he wants to have access to the documents summoned by the court. The court has reserved its order on the same.


It is ludicrous to accuse BJP of political vendetta when this is a case that had been filed against them years ago. Also, by making such statements, they are disparaging the judiciary. It is absolutely unacceptable to have leaders malign the judiciary of political influence, much less from the ones accused of corruption. The attitude only shows the lack of respect our leaders have towards the judiciary of the country. The Gandhis consider themselves powerful enough to unethically acquire properties worth crores of rupees on public money and yet demean the justice system. Even if the case is false and there was actually no misappropriation of money, they should let the law take its own course instead of faltering the proceedings in the Parliament as no one is above the law.

Latest Development: 

The Company, Young Indian filed a petition before the Delhi High Court to stay the investigations being carried out by the Income Tax department. However, on 12/05/2017 the Delhi High Court rejected the plea stating that the Congress cannot be arrogant and refuse to produce documents for investigation. The court directed them to approach the income tax assessing officer instead, in what is being construed as a major blow to Congress.

Senior lawyer and Congress leader, Abhishek Manu Singhvi said that “We will now go back to the assessing officer and can raise objections, including challenge re-opening income tax investigations, as the IT department doesn’t have enough evidence to probe Young Indian.”

Picture Courtesy: Pixabay

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