National Herald Case: Delhi Court Probes Allegations of Asset Usurpation by Congress Leadership
ED's Allegations on AJL's ₹2,000 Crore Assets
In the ongoing hearing of the high-stakes National Herald money laundering case, the Rouse Avenue Court in Delhi has raised crucial questions regarding the alleged misappropriation of Associated Journals Limited’s (AJL) assets worth ₹2,000 crore. The Enforcement Directorate (ED), represented by Additional Solicitor General (ASG) S.V. Raju, has argued that the transfer of AJL to Young Indian—a company allegedly controlled by Congress leaders Sonia Gandhi and Rahul Gandhi—was not a legitimate business transaction but a calculated conspiracy to gain control of valuable real estate assets.
₹90 Crore Loan for ₹2,000 Crore Company: A “Sham Transaction”?
The ED contended that the Indian National Congress extended a loan of ₹90.25 crore to AJL, which was financially struggling and unable to repay its dues. In a series of moves that the ED claims are fraudulent, Young Indian was allegedly formed and took over AJL’s massive assets in exchange for a nominal payment of ₹50 lakh. ASG Raju emphasized the absurdity of a financially weak entity like Young Indian acquiring a company worth ₹2,000 crore without any tangible revenue or operational capability.
The ED further submitted that Dotex, another entity allegedly connected to the case, gave a ₹1 crore loan to Young Indian, of which ₹50 lakh was paid to the All India Congress Committee (AICC). This facilitated Young Indian’s acquisition of AJL.
Who Benefited? Questions on Shareholding and Control
The ED’s charge sheet names seven accused—Sonia Gandhi, Rahul Gandhi, Suman Dubey, Sam Pitroda, Young Indian, Dotex, and Sunil Bhandari. The agency argues that Sonia and Rahul Gandhi held a 76% combined shareholding in Young Indian (38% each), and were the direct beneficiaries of the AJL takeover.
According to ASG Raju, Young Indian’s audit reports also show Sonia Gandhi, Rahul Gandhi, Dubey, and Pitroda as key managerial personnel, suggesting complete control. After the deaths of Motilal Vohra and Oscar Fernandes, control allegedly consolidated further under the Gandhis.
Court's Probing Questions: Is Congress the Victim?
Special Judge Vishal Gogne actively interrogated the ED's theory, raising pertinent legal and financial questions. The court asked whether the Congress Party could be considered a victim in this case, given it suffered an ₹89 crore loss. ASG Raju replied that it was not a loss but a fraudulent transaction designed to enrich the shareholders of Young Indian.
Further, the court questioned why Congress would give a second loan to AJL when it was unable to repay the first. The ED responded that such a move was not prudent, and underscored the alleged conspiracy to write off the loan and transfer valuable assets cheaply.
Court Queries on Precedents: Are Loan Write-Offs Illegal?
The court asked whether such practices were unique or if similar actions are seen elsewhere—such as banks or PSUs writing off loans. The ED clarified that banks write off loans due to lack of assets or operational failure, whereas AJL had ₹2,000 crore in assets, which could have been monetized.
The court also directed the ED to verify AJL's shareholder structure and questioned why Congress is not a listed shareholder in AJL if it was so deeply financially involved.
What’s Next?
The matter has been listed for further hearing on July 3, 2025. The ED is expected to clarify the legal standing of the Congress Party in AJL's shareholder structure, and substantiate its claim that the entire transaction was fraudulent.
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