At the Heart of a Political Brawl in India, Two Historic Newspapers

Anindianmuslim.com blogA screenshot of the masthead of Qaumi Awaz, an Urdu  newspaper started by Jawaharlal Nehru, that was shut down in 2008. 

Subramanian Swamy, chief of the Janata Party, on Thursday accused Sonia Gandhi, the Congress Party president, and Rahul Gandhi, the Congress general secretary, of illegally purchasing a publishing company to gain ownership over land that it held.

Hours later, Mr. Gandhi, in a letter addressed to Mr. Swamy and circulated in the press, called Mr. Swamy's accusations “utterly false, entirely baseless and defamatory,” and threatened to sue. “We ar e committed to pursuing all legal actions against the scandalous abuse evident in your so-called ‘press conference,' ” the letter said. A suit against Mr. Swamy could be filed in the next few days, one adviser said.

At the heart of the acrimonious battle, just the latest between Mr. Swamy and the Gandhi family, is a company called Young Indian. Mr. Swamy claims it was established by Mrs. Gandhi and her son to do what he called a “stinking deal” aimed at acquiring a publicly listed publishing company, Associated Journals. Associated Journals owned property in Uttar Pradesh and Delhi worth, he said, $295 million.

Beyond Mr. Swamy's allegations, public information about Young Indian, Associated Journals or the alleged land deals is limited, but the company appears to be a not-for-profit formed to revive two historic newspapers.

From the Ministry of Corporate Affairs' Web site comes this list of “Section 25” companies, or those formed “for the sole purpose of promoting commerce, art, science, religion and charity or any other useful objects.” According to page 61, Young Indian was formed on Nov. 23, 2010, and lists its address as 5A, Herald House, Bahadur Shah Zafar Marg, in New Delhi.

Among other rules, Section 25 companies must apply any income or profits to promoting its objectives, and are forbidden to pay dividends to members.

Associated Journals stopped publication of two of its newspapers in 2008, long before Young Indian was formed. Quami Awaz, an Urdu newspaper founded by Mr. Gandhi's great-grandfather, Jawaharlal Nehru, and the English-language National Herald, which was edited by Mr. Nehru before he became prime minister, shut down in the spring of 2008.

At the time, loyal readers decried their closure, particularly because it came while Mr. Nehru's Congress Party was in power. “Sonia Gandhi's intervention would have saved the papers,” wrote the blogger An Indian Muslim at the time. “Forever I will miss the newspaper that was once largely circulated in entire North India.”

Young Indian planned to revive the papers, the Press Trust of India reported on Oct. 9. The news agency, citing Registrar of Companies documents, said the former Indian Express editor Suman Dubey was the signatory to the company and that the papers would be “set up under the guidance of top leadership of Congress Party,” and that Sam Pitroda, a telecommunications industry entrepreneur, was also involved.

Rahul Gandhi's office had responded to the Press Trust of India's e-mail inquiries by saying that Young Indian “is a not-for-profit company and does not have commercial operations” and that it had “no intention of starting” any newspapers, and neither Mr. Dubey or Mr. Pitroda responded to questions.

However, Mr. Pitroda's official website, in his current capacity as adviser to the prime minister, displays a Hindustan Tim es article from May 2011 which reported that the Congress would soon be restarting the National Herald along with its Hindi edition, Navjeevan, and the Urdu edition, Quami Awaz.

Mr. Pitroda, the adviser to prime minister on public information, infrastructure and innovations, was roped in “to give a new look to the publications,” the Hindustan Times said.

On Thursday, Mr. Swamy also alleged that the All India Congress Committee had given Associated Journals an unsecured loan of over $16 million, which he said was illegal because a political party cannot give loans for commercial purposes under the Income Tax Act. He provided no documentation of the allegations.

Janardan Dwivedi, chairman, media department of the All India Congress Committee issued a statement Friday saying that the object of the Indian National Congress is the “well being and advancement” of the Indian people and that it has done its duty by supporting The Associated Journals “to h elp initiate a process to bring the newspaper back to health in compliance with the laws of the land”. The support, the statement says, was in the form of “interest free loans from which no commercial profit has accrued to the Indian National Congress.”

An income tax lawyer, who prefers to remain unnamed due to a conflict of interest, said that such a loan was illegal according to Section 13 A of the Income Tax Act, which speaks of special provisions made for the income of political parties. Income of political parties is exempted from taxation, he said, however the money thus exempted is not meant to be used for purposes other than those of the political party.

Phone calls to the Registrar of Companies went unanswered, as did calls to the Ministry of Corporate Affairs, the Securities and Exchange Board of India and the offices of Mr. Gandhi and Mr. Pitroda.