Congress President Sonia Gandhi and her son Rahul Gandhi today suffered a big jolt when the Delhi High Court rejected their pleas for quashing the summons against them in the National Herald case and made scathing observations on their “questionable conduct” regarding how they took control of the publication.
Justice Sunil Gaur also turned down their plea for exemption from personal appearance in the case in the trial court, where it is listed tomorrow.
Along with the Gandhis, five other accused–Suman Dubey, Moti Lal Vohra, Oscar Fernandez, Sam Pitroda and Young India Ltd–had challenged the summons issued to them by a trial court on a complaint by BJP leader Subramanian Swamy against them for alleged cheating and misappropriation of funds in taking control of the now-defunct daily.
“After having considered the entire case in its proper perspective, this court finds no hesitation to put it on record that the modus operandi adopted by petitioners in taking control of Associated Journals Ltd (AJL) via special purpose vehicle i.E. Young India Ltd (YIL), particularly, when the main persons in Congress Party, AJL and YIL are the same, evidences a criminal intent.
“Whether it is cheating, criminal misappropriation or criminal breach of trust is not required to be spelt out at this nascent stage.
“In any case, by no stretch of imagination, it can be said that no case for summoning petitioners as accused in the complaint in question is made out. Questionable conduct of petitioners needs to be properly examined at the charge stage to find out the truth and so, these criminal proceedings cannot be thwarted at this initial stage,” the judge said in his 27-page order.
The judge was also of the view that “the gravity of the allegations levelled against petitioners (Sonia, Rahul and others) has a fraudulent flavour involving a national political party and so, serious imputations smacking of criminality levelled against petitioners need to be properly looked into”.
The court said “the ingredients of the offences alleged
are not lacking and sufficient ground to proceed against petitioners certainly exists. No mala fides can be alleged against respondent-complainant (Swany) nor can it be said the summoning of petitioners is an abuse of process of the court.”
It also said that “legal jugglery” of words “does not and cannot” persuade it to opine, at this initial stage of the proceedings, that allegations in Swamy’s complaint do not make out a prima facie case for summoning the Congress leaders.
“The sum and substance of the allegations levelled against petitioners cannot be brushed aside by merely saying that at best it is a case of takeover of AJL and the remedy lies in invoking the provisions of the Company Act,” it said.
Referring to the complaint by Swamy, the court said that “the transactions of the Congress Party with AJL via YI are not mere commercial transactions as these transactions legitimately attract the allegations of cheating, fraud, breach of trust, misappropriation, etc.”
On whether Swamy had the locus to make the complaint, the high court said “the plea of locus standi cannot be restricted to typical cases of cheating, misappropriation, etc., as here is a case where the act of office bearers of political party having criminal overtones is under scrutiny and so, the challenge to the locus of respondent-complainant to maintain the complaint in question is hereby repelled”.
The objection to summoning of Pitroda and Fernandes on the ground that they reside outside territorial jurisdiction of the trial court was rejected by the high court by terming it as “hyper-technical”.
It also termed as “questionable” the manner in which the shares of AJL were acquired by YIL.
The party had loaned Rs 90.25 crore to AJL, publisher of National Herald, and on December 28, 2010 it had assigned this debt to YIL, a charitable company, for Rs 50 lakh, which, according to Swamy, amounted to breach of trust and cheating.
The court said that the Congress leaders need to explain what was the need to assign the “huge debt of Rs 90 crores” when this loan could have been repaid by AJL from its “sizeable assets” of Rs 2000 crore.
“Even writing off such a huge debt by the Congress Party can legitimately attract allegations of cheating, fraud, etc.. Petitioners had gone step further in conspiring to get this huge debt assigned to a special purpose vehicle i.E. YI and thereafter, to hijack AJL via YI.
“Such grave allegations levelled against petitioners cannot be brushed aside lightly by relying upon judicial precedents cited, to conclude that the ingredients of the criminal offences alleged are lacking. To say the least, to do so would be preposterous,” it said.