Political party can write off or assign loans: Sonia to HC
6 Aug 2014 6:18 AM IST
‘The issuance of process in this case is shocking and out of order, to say the least, and no illegality can be found either on the facts or on the law,’ former Law Minister and senior advocate Kapil Sibal, appearing for the Congress President, told a bench of Justice V K Vaish.
The trial court had issued summons to various Congress leaders on the complaint of BJP leader Subramanian Swamy who has alleged cheating and misappropriation of funds in acquiring ownership of the now-defunct daily National Herald by Young Indian (YI). Sonia Gandhi, Congress Vice President Rahul Gandhi, Party Treasurer Moti Lal Vora are among the directors of YI, who have been summoned.
Seeking setting aside of Swamy’s complaint, Gandhi said the Associated Journals Limited (AJL), which had been publishing newspapers ‘National Herald’ in English, ‘Navjivan’ in Hindi and ‘Quami Awaz’ in Urdu, had taken loans to the tune of Rs 90 crores from the Congress Party.
The loan, given to AJL, was assigned to YI by the Congress party and then a process of conversion of Rs 90 crores loan was taken by AJL which then issued fresh equities in favour of charitable firm YI.
Congress Party for a monetary consideration of Rs 50 lakhs had decided to assign Rs 90 crores loan
to YI, she maintained.
Citing various law and verdicts, Sibal said that these are valid transactions and no illegality can be found.
‘The Congress Party was well within its right to give the loan to AJL in view of the objects of AJL which included dissemination of the views of policy and principles of INC.
‘The INC was equally within its right to write-off the loan/assign the loan to YI and there was no breach or illegality. There is no illegality in extending support to a Section 25 company (charitable firm YI) by the INC,’ he said.
The trial court on June 26 had summoned Sonia, Rahul, Vora, party General Secretary Oscar Fernandes, Suman Dubey and Sam Pitroda to appear before it on August 7. The High Court would hear tomorrow the remaining arguments in the case.
The trial court had issued summons to various Congress leaders on the complaint of BJP leader Subramanian Swamy who has alleged cheating and misappropriation of funds in acquiring ownership of the now-defunct daily National Herald by Young Indian (YI). Sonia Gandhi, Congress Vice President Rahul Gandhi, Party Treasurer Moti Lal Vora are among the directors of YI, who have been summoned.
Seeking setting aside of Swamy’s complaint, Gandhi said the Associated Journals Limited (AJL), which had been publishing newspapers ‘National Herald’ in English, ‘Navjivan’ in Hindi and ‘Quami Awaz’ in Urdu, had taken loans to the tune of Rs 90 crores from the Congress Party.
The loan, given to AJL, was assigned to YI by the Congress party and then a process of conversion of Rs 90 crores loan was taken by AJL which then issued fresh equities in favour of charitable firm YI.
Congress Party for a monetary consideration of Rs 50 lakhs had decided to assign Rs 90 crores loan
to YI, she maintained.
Citing various law and verdicts, Sibal said that these are valid transactions and no illegality can be found.
‘The Congress Party was well within its right to give the loan to AJL in view of the objects of AJL which included dissemination of the views of policy and principles of INC.
‘The INC was equally within its right to write-off the loan/assign the loan to YI and there was no breach or illegality. There is no illegality in extending support to a Section 25 company (charitable firm YI) by the INC,’ he said.
The trial court on June 26 had summoned Sonia, Rahul, Vora, party General Secretary Oscar Fernandes, Suman Dubey and Sam Pitroda to appear before it on August 7. The High Court would hear tomorrow the remaining arguments in the case.
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