The Enforcement Directorate (ED), while attaching properties worth ₹751 crore in its money-laundering probe into the National Herald newspaper last month claimed that a criminal conspiracy was hatched to give control of properties worth “hundreds of crores of rupees” of Associated Journals Limited (AJL) to the “beneficial owners” of Young Indian, Sonia Gandhi and Rahul Gandhi, people familiar with the development said on Tuesday.

According to details of the ED’s proceedings under section 5 (1) of the Prevention of Money Laundering Act (PMLA), the three immovable properties attached on November 21 include Herald House at Bahadur Shah Zafar Marg, Delhi, with a market value of ₹351 crore (as assessed by the Income Tax department in 2017), AJL House in Bandra, worth ₹245 crore, and the AJL office at Bisheshwar Nath Road, Lucknow, worth ₹64 crore.

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ED said that while Herald House in Delhi was given to AJL by the President of India on August 2, 1962, on lease, which was turned into a perpetual lease in January 1967, the property in Mumbai was given to AJL through an order by Maharashtra government on August 31, 1983, and the Lucknow property was acquired through a sale deed from Diocesan Trust Association, Lucknow.

Besides immovable properties, the ED attached 90,216,898 shares of Young Indian (YI) worth ₹90.21 crore, terming them as “direct proceeds of crime”. On why it was decided to attach these properties, an ED officer, citing details of the attachment order, said, “If these properties are not attached, there is every likelihood that they could be transferred and dealt with in a manner which may result in frustration of any proceeding relating to confiscation of the said proceeds of crime.”

The Congress has denied the charges, and described the case as a “witch-hunt”.

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Explaining the alleged conspiracy, the ED officer cited above said, “AJL, which owned properties worth hundreds of crores, closed its (publishing) operations in 2008 and started using these assets for commercial purposes. A criminal conspiracy was hatched to give control of properties worth hundreds of crores of rupees belonging to AJL to the beneficial owners of YI – Sonia Gandhi and Rahul Gandhi. YI was incorporated for this purpose only in November 2010.”

ED said that the “the same set of people were appointed in AJL and YI, who were also members of the All India Congress Committee (AICC)”.

As part of the conspiracy, a loan of ₹90.21 crore, given by AICC to AJL, was assigned to YI for a sum of ₹50 lakh “by passing resolutions by the same set of people holding positions in these three entities”, said a second officer, who also asked to be named. Thereafter, YI asked AJL to repay a loan of ₹90.21 crore assigned to it by AICC or convert it into equity, the officer added.

ED said it found that AJL called an extraordinary general meeting (EGM), attended by the “same set of people” and passed a resolution to increase share capital and issue fresh shares worth ₹90.21 crore to YI. “With this fresh allotment of shares, shareholding of more than 1,000 shareholders was reduced to a mere 1% and AJL became a subsidiary company of YI. YI also took control over properties of AJL,” ED claimed in its statement on November 21.

This way, the second ED officer said, “the criminal conspiracy was executed and control of assets of AJL worth hundreds of crores of rupees was transferred to the beneficial owners of YI”.

The Congress has repeatedly said that the transaction was done to help save the newspaper and pay the salaries of journalists and staff at a time when AJL faced huge debts. It argues that the decision helped revive the organisation and blames the central government of raking up an old issue to target the Gandhi family for political vendetta.

In a detailed statement on November 21, Congress leader Abhishek Manu Singhvi said, “PMLA action can only be consequential to some predicate or main offence. There is no transfer of any immovable property. There is no movement of money. There are no proceeds of crime. Indeed, there is no complainant who claims to have been cheated: not a single one. This is a prefabricated structure of deceit, lies and falsehood of, by and for the BJP to divert, distract and digress in the middle of elections.”