Delhi High Court has scheduled March 9 to hear the Enforcement Directorate’s challenge to a trial court order declining to take cognisance of its chargesheet against Congress leaders Sonia Gandhi, Rahul Gandhi and others in the National Herald-linked money laundering case.The matter, which has been politically contentious and legally complex, returns to the spotlight after the federal agency moved the High Court contending that the trial court erred in refusing to proceed against the accused under the Prevention of Money Laundering Act. The trial court had declined to take cognisance of the prosecution complaint, citing what it described as procedural and legal shortcomings in the material placed before it.
At the centre of the dispute lies the alleged financial restructuring of Associated Journals Limited, the publisher of the National Herald newspaper, and the role of Young Indian, a not-for-profit company in which Sonia Gandhi and Rahul Gandhi are majority shareholders. The Enforcement Directorate alleges that the acquisition of AJL’s debt by Young Indian and the subsequent control over its assets amounted to laundering of proceeds of crime. The Congress leadership has consistently denied any wrongdoing, maintaining that the transaction was lawful and undertaken to revive a defunct publication.
The High Court’s listing comes amid an ongoing legal battle that has spanned more than a decade. The origins of the case trace back to a private complaint filed in 2012 before a magistrate’s court, alleging cheating and criminal conspiracy in the transfer of AJL’s assets. Summons were issued to Sonia Gandhi, Rahul Gandhi and other party functionaries in 2014 in the predicate offence case. The Enforcement Directorate initiated its own probe under money laundering laws based on the same set of allegations, attaching immovable properties linked to AJL in Delhi, Mumbai and other cities.
Following a prolonged investigation, the agency filed its prosecution complaint, asserting that the accused had derived undue financial benefit through the takeover of AJL’s assets, which include prime real estate holdings. The trial court, however, declined to take cognisance, effectively halting the money laundering proceedings at that stage. The Enforcement Directorate’s appeal seeks reversal of that order, arguing that sufficient grounds exist for the court to proceed and examine the charges in detail.
Legal observers note that the High Court’s consideration will focus on whether the trial court correctly applied the threshold for taking cognisance under the Prevention of Money Laundering Act. At this stage, the court is not expected to adjudicate on guilt or innocence but to assess whether the material on record warrants further proceedings. The distinction between the predicate offence and the alleged laundering of its proceeds is also likely to feature prominently in arguments.
The Congress party has described the case as politically motivated, accusing the central government of misusing investigative agencies to target opposition leaders. Senior party figures have argued that Young Indian is a non-profit entity and that no personal enrichment occurred. They have also pointed out that the underlying criminal complaint remains contested and that any money laundering charge must be premised on a demonstrable scheduled offence.
The Enforcement Directorate, for its part, has maintained that the structure of the transaction allowed control over assets valued at several hundred crore rupees without commensurate financial consideration, thereby attracting provisions of the money laundering statute. The agency has cited documentary records and financial statements to support its case.
Over the past few years, courts have examined various aspects of the National Herald matter, including challenges to summons, attachment orders and jurisdictional issues. The High Court’s forthcoming hearing adds another layer to the judicial scrutiny surrounding one of the most high-profile financial investigations involving senior political leaders.
The case also unfolds against a broader backdrop of increased use of anti-money laundering laws in economic and political cases. Courts across the country have grappled with questions relating to the scope of the Prevention of Money Laundering Act, the standard of proof at the stage of cognisance and the balance between investigative powers and individual rights. Several judgments of the Supreme Court have clarified aspects of arrest, attachment and bail under the statute, shaping the legal terrain within which the present appeal will be argued.