Published 16:18 IST, February 11th 2019
Trouble mounts for Gandhis as government seeks lifting of corporate veil in National Herald case
The government has asked the Delhi HC to pierce the corporate veil and hold the Gandhis personally and directly liable for the defaults in the National herald case
The pressure on Gandhi family in the National Herald case is set to mount as the Central government, represented by Solicitor General Tushar Mehta, has requested the Delhi High Court to pierce the corporate veil for Young India - present owner of National Herald.
The government has asked the Delhi HC to pierce the corporate veil and hold the Gandhis personally and directly liable for the defaults in the National herald case.
It means that the government wants the shareholders of the company - in this case Rahul Gandhi, Sonia Gandhi, Oscar Fernandes and Motilal Vora - to be held responsible for the liabilities and defaults of Young India.
Solicitor General argued in front of the two-judge bench of the HC that AJL violated the lease deed signed with the government of India when the company was transferred to Young India. He further alleged that Young India escaped income assessment by the IT department.
Tushar Mehta also questioned the manner in which the transfer took place, and accused Rahul Gandhi and Sonia Gandhi of “holding on to a public property (herald house) to earn crores in rent”.
On November 12, 2018, the Delhi High Court had deferred the petition filed by AJL against the Centre's decision to cancel its lease and vacate the Herald House by November 15 on grounds of violation of lease clauses. The Counsel for Land and Development Office (LDO) had intimated that the department would "initiate proceedings" to have the premises vacated in the case but AJL did not hand it over.
A month later, the same court dismissed the plea of AJL challenging the eviction order by the Centre. In its observations, the court called acquisition of AJL by Young India “questionable”. It stated that the purpose for which herald house was leased to AJL was “practically lost”, while also mentioning that the major portions of Herald House have been rented out.
Updated 16:45 IST, February 11th 2019