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The National Herald Case: Facts you need to know

December 9, 2015

The National Herald case

The National Herald was an Indian newspaper, under the Associated Journals Ltd (AJL), established in 1938 by Jawaharlal Nehru. The paper ceased operation in 2008, including Urdu newspaper Quami Awaz, citing financial troubles. All the 5,000 shareholders of AJL were Congressmen or Congress sympathizers.

The core business of AJL gave way to real estate ventures in Delhi, Lucknow, Patna, Mumbai and Panchkula. Over the years AJL acquired property worth Rs. 5000 crore. In December 2010, Young Indian, a Section 25 company and majority (76 per cent) owned by Sonia Gandhi and Rahul Gandhi, acquired almost the entire stake of AJL.

BJP leader Subramanian Swamy had alleged that Congress leaders were involved in cheating and breach of trust in the acquisition of Associated Journals Ltd (AJL) by ousting the other shareholders of the publication and assets worth crores of rupees had been transferred to YIL. He filed a complaint regarding the same with the trial court in 2012.

The allegations

  • YIL, with Sonia Gandhi and Rahul Gandhi in its board of directors, had ousted 1,057 shareholders.
  • YIL had paid just Rs 50 lakh to obtain the right to recover Rs 90.25 crore that AJL had owed to the Congress party, given earlier as a loan to start the newspaper.
  • A fair valuation of the assets had not been done before handing over the equity in exchange of waiving of the loan of Rs 90 crore.
  • The complaint has also alleged that the loan given to AJL was “illegal”, as it had been taken from party funds.
  • YIL had taken over assets worth Rs. 2000 crore in a malicious manner.
  • Questions are being raised as why AJL did not take necessary action of disposing off a part of its prime assets to repay the debts.
  • Congress treasurer Motilal Vora, general secretary Oscar Fernandes, technocrat Sam Pitroda and journalist Suman Dubey and were also named in the case.

The Case

After examining Subramanian Swamy, the complainant in the case, R Venkatesh, practising chartered accountant, Gulab Chand, an official from the Office of the Registrar of Companies, NCT of Delhi and Haryana, and J Gopikrishnan, journalist with The Pioneer, in the pre-summoning stage, the Delhi High Court summoned Sonia Gandhi, Rahul Gandhi, Motilal Vora, Oscar Fernandes, Suman Dubey and Sam Pitroda on 26 June 2014. The summon stated, “It appears that YI was in fact created as a sham or a cloak to convert public money to personal use” in order to acquire control over Rs 2,000 crore worth of assets of AJL. The court noted that all accused persons had allegedly acted “in consortium with each other to achieve the said nefarious purpose/design”.

The Trial court has asked the accused to appear on 7 August 2014, but the Congress leaders obtained a stay order from the High Court citing the following:

  • That YIL was not a profit oriented organisation, and in fact was created for the purposes of charity.
  • The commercial transactions that had been conducted did not have any illegal tone and was conducted merely for the purpose of transferring shares of the company.
  • In the appeal it has also been stated that the reason for such allegations by Swamy was politically motivated.

The High Court Judgement on Appeal against Summons to Face Trials

The judgment of the High Court has noted:

  • That the uprightness of a major political party was at stake in the case, as here the people named were the office bearers of the same.
  • Stating that prima facie the case had the evidence of criminality, the High Court dismissed the appeal.
  • The court has also upheld the doubt about the legality of the initial loan granted to AJL by the Congress party.
  • The High Court also questioned the acquisition without the involvement of the other shareholders of AJL.

On 7 December 2015, the Delhi High Court dismissed the appeals filed by Congress president Sonia Gandhi, vice president Rahul Gandhi, and five others against summons to face trial and today the trial court fixed 19 December as a date for their appearance.

The Congress Reaction

Sonia Gandhi reacted to this judgement with the words, “Why should I be scared of anyone? I am Indira Gandhi’s Daughter-in-law, I am not scared of anyone”.

Congress leaders are insisting that Swamy is a front and in their words, “Prime Minister Narendra Modi has invited the Congress for a political fight and we will not shy away. The Congress will take the BJP head on,” said Randeep Surjewala, Congress communications chief.

This is the first time that the mother-son duo of India’s first political family will appear in court. The rights and wrongs have to be delved in and hopefully this time India will see justice.


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I am an Indian...Wedded to the Olive Green, I believe I belong to the Silent Ranks. I am extremely perturbed by the social issues concerning India. I in my own capacity am trying to bring about that change for a brighter tomorrow.

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Showing 1 Comments :
Sathyamoorthy.U December 9, 2015 at 5:33 pm

The author has, with all objectivity, has brought out the
essence of the entire case.
The Courts have well understood the core issues involved and their comments speak for itself. Judiciary has been allowed to function much more independently under the present BJP Government than it was under the previous regime. Hence there is no question of the present Government bringing any pressure on any one. Neither Mr.Swamy is someone who dances to the tune of anyone within his party. Let justice prevail in this case. The entire nation knows true colours of Congress men and their present leaders as also their cronies..

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