The National Herald case's FIR, which reads like a synopsis of Firstpost's December expose translated in Hindi, alleges abuse of power in land allocation.

Editor's note: This article, which was published on 9 May, 2016, is being republished in view of the Enforcement Directorate's decision to take possession of land worth Rs 64.93 crore soon in Panchkula, which was allotted to the Associated Journals Limited by the Haryana government in 2005 after a quasi-judicial authority recently approved its order.

Fresh trouble is brewing for the Gandhi family, with the Haryana state government filing a First Information Report (FIR) for the illegal allotment of prime land in Panchkula, estimated to be worth roughly Rs 100 crore, to the Associated Journals Ltd (AJL). AJL is the parent company of National Herald, the now defunct mouthpiece of the Congress Party.

The move follows a Firstpost expose of 29 December 2015 detailing the file movement that showed how former chief minister Bhupinder Singh Hooda overturned legal and official advice from within his government to first illegally re-allott the plot, then condone delays and defaults, even going so far as to extend additional unwarranted and unprecedented favors, including “camouflage aid to the firm”.

The FIR (No. 3 of 2016) has been registered in the State Vigilance Bureau (SVB) Police Station, Panchkula, against officials of AJL, the then chairman (Hooda himself) of the Haryana Urban Development Authority (HUDA), the then chief administrator of HUDA and others, under Sections 409, 420, 120B of the Indian Penal Code along with Section 13 of the Prevention of Corruption Act 1988. The SVB is the main investigative unit of the Vigilance Department.

However, it is learnt that the state government has decided to refer the case to the CBI rather than investigate it independently. This is because the case requires an expanded jurisdiction as AJL has offices across the country and also because it involves several powerful politicians.

The FIR, which reads like a synopsis of the Firstpost expose translated in Hindi, alleges abuse of power to fraudulently prepare false records to allot the plot at a lower rate, causing a loss of Rs 62 lakh to the state exchequer. The issue of “camouflage aid” has been highlighted. This is the first FIR against land allotment to AJL and its outcome will have a bearing on the case filed by BJP MP Subramanian Swamy in a Delhi court against the Gandhis for allegedly usurping the assets of AJL (details below).

Panchkula plot history

The institutional site No C-17, Sector 6, Panchkula measuring 3,500 square metres, was first allotted to AJL on 24 August 1982 for the purpose of publishing a newspaper but had to be resumed (taken back by the state government) when AJL failed to construct even after 10 years of possession.

Persistent attempts by AJL to restore the allotment failed during the tenure of the Congress regime under chief ministers Bhajan Lal and Bansi Lal because they chose to follow the rule book. However, matters took a favorable turn for AJL after Bhupinder Singh Hooda took over as chief minister and immediately began to throw legal issues to the winds.

The sequence of events recorded in AJL's Panchkula file history with HUDA shows that the intent behind acquiring the institutional plot was purely that of asset acquisition rather than the stated purpose of running a newspaper since construction on the plot — that was acquired in 1982, resumed in 1996 and later illegally re-allotted in 2005 by a the Hooda regime — took place only after 31 years in 2013, and only after exhausting all further leverage options. Even today, though the construction of the building may be complete, Navjivan, the Hindi daily that was supposed to be published from there, is nowhere in sight.

FIR fuels AJL matter

In 2013, economist, lawyer and BJP leader Subramanian Swamy took the Gandhis, their companies and associated persons to court on charges of cheating and breach of trust to grab valuable land assets across Lucknow, New Delhi, Mumbai, Indore, Bhopal and Panchkula under AJL.

As per the complaint filed in the court of the metropolitan magistrate, the Indian National Congress first granted an interest-free loan of Rs 90.25 crore ($13 million) to AJL, owner of the National Herald newspaper which was established in 1938 by Jawaharlal Nehru with the support of 5,000 other freedom fighters who also became shareholders.

Soon after, a closely held company, Young Indian (YI) was incorporated on 23 November, 2010 with a capital of Rs 50 lakh. On 13 December, 2010, Rahul Gandhi was appointed director of YI while Sonia Gandhi joined the board on 12 January, 2011. Sonia and Rahul Gandhi together hold 76 percent equity in Young Indian while the rest is equally held by Congress leaders Motilal Vora and Oscar Fernandes (12 percent each). YI has been described by Rahul Gandhi's office as a "not-for-profit company" which has “commercial” operations.

On 26 February, 2011, AJL allegedly approved the transfer of its Rs 90.25 crore loan along with all its properties (alleged to be now worth up to about Rs 5000 crore ($740 million) to YI. Swamy has alleged that the loan was either not repaid, or repaid in cash, which is in violation of Section 269T of the Income Tax Act, 1961.

Motilal Vora has been the chairman and managing director of AJL since 22 March, 2002. The company had 1,057 shareholders as of 29 September 2010, as per the annual return filed with the Registrar of Companies.

Congress President Sonia Gandhi, her son Rahul Gandhi, party leaders Motilal Vora, Oscar Fernandes, Suman Dubey, Sam Pitroda and YI are all accused in the matter (for which they had to make a personal appearance in the Patiala House courts on 19 December 2015.

Other Hooda probes also connect to Gandhis

Hooda is already under probe by the Justice SN Dhingra Commission for his role in the illegal grants of licences to hundreds of private companies, including Robert Vadra’s land case, involving his company Skylight Hospitality and DLF.

A CBI enquiry into 14 other plots allotted in violation of due process by Hooda is already ongoing on the reference of the state government.

The Panchkula land allotment, which records all the persistent, violations committed during the UPA’s term at the Centre with a Congress regime in the state, suggests the Congress has a lot of explaining to do for its wanton political patronage of AJL.

Initially, both the Gandhis and Hooda were daring the government to initiate inquiries to establish allegations of wrongdoing. Now that these inquiries are on full swing, both parties have started accusing the BJP governments at the centre and in Haryana of pursuing vendetta politics.

FIR in National Herald Case by Firstpost