How a Damaad plundered the nation
Sandhya Jain28 Apr 2014
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Sandhya Jain is a political analyst and independent researcher. She is the author of ‘Adi Deo Arya Devata- A Panoramic View of Tribal-Hindu Cultural Interface’ (Rupa & Co., 2004) and ‘Evangelical Intrusions. Tripura: A Case Study’ (Rupa & Co., 2009).
Manmohan Singh’s best-selling biography, The Accidental Prime Minister, confirms this writer’s long-held belief that this inscrutable, unflappable, incorruptible, well-read and well-informed gentleman swallowed the mountains of humiliation heaped on him to achieve a singular objective, viz, strip the Congress’s ruling dynasty of its Teflon coating. The signs were always there, though few believed it possible, given his quiet demeanour.Half-way into his second term, around March 2011, as the foul odours of corruption began emanating from UPA-II, over which the Italian-born Sonia Gandhi had a stranglehold, the nation was stunned to learn that Robert Vadra, son-in-law of the Congress president and a small time exporter of artificial jewellery, was rapidly enriching himself in the realty sector.
A simultaneous development, which received inadequate media attention at the time, was that the Income Tax Appellate Tribunal (ITAT) ruled that the late Win Chaddha had taken a legally-banned commission on the Bofors gun deal; his heirs were made to part with the requisite income tax dues! Thus, while Sonia Gandhi was able to ensure that Ottavio Quattrocchi collected his money from two London bank accounts and that none of those who helped in the collection of the kickbacks suffered, the ITAT put it on record that there were illegal payoffs in the Howitzer deal.
Damaad Shri — The Vadra Get-Rich-Quick Model
This was a major salvo at the family, though the spin doctors quickly deflected attention away from the incident. Yet it is pertinent that for roughly three decades, Manmohan Singh has been at the commanding heights of India’s finance sector (Reserve Bank Governor, Finance Minister, Prime Minister); he would have juniors and loyalists who would keep him informed about the doings of just about everyone. All leaks pertaining to the Gandhi family, which have escalated in recent times, can be traced back to sectors and individuals closely associated with Manmohan Singh. The latter’s personal discretion can be gauged from the fact that few knew he was close to PV Narasimha Rao, until he was made the Union Finance Minister!
Revelations about Robert Vadra’s real estate acquisitions came soon after the Prime Minister told a group of select senior journalists that he was no intention of resigning (read being driven out) in the wake of the Spectrum scam. Sonia loyalists sharpened their attack on him immediately thereafter, nudging journalists to target the Prime Minister and his office for the sins of omission and commission in the Spectrum scandal.
This was followed by the mysterious and otherwise inexplicable leakage of the Nira Radia tapes which showed that some journalists had networked closely with Congress leaders close to Sonia Gandhi to get the Telecom portfolio for Andimuthu Raja once again in the UPA II.
Then came the expose about Robert Vadra, specifically his entry into the real estate business from 2007-08, in partnership with realty major, DLF Ltd. As a result, Vadra began buying up land in Haryana and Rajasthan, acquired 50 per cent stake in a leading business hotel in Delhi, and was trying to enter the business of chartering aircraft when the first storm broke.
He first floated six companies, took unsecured loans from DLF group companies, including the Bombay Stock Exchange-listed flagship DLF Ltd. Sky Light Hospitality Pvt Ltd (wholly owned by Vadra and his mother Maureen Vadra) is a partner, along with DLF Hotel Holdings and others, in a partnership firm that owns the posh Hilton Garden Inn in Saket. This was possible because DLF extended generous loans to Vadra companies, some without collateral. In March 2009, Sky Light Hospitality had received unsecured loans amounting to Rupees 25 crore from DLF Ltd and in March 2010, only Rupees 10 crore remained. To this day, it is unclear from his statement of accounts if the rest was paid back or written off.
Sky Light Hospitality then loaned money to other Vadra-owned companies such as Blue Breeze Trading Pvt Ltd, North India IT Parks Pvt Ltd, Real Earth Estates Pvt Ltd and Sky Light Realty Pvt Ltd. At that time, the main Opposition Bharatiya Janata Party did not play up the issue, but now the party is under a different leadership.
In 2011 itself, Manmohan Singh told the Parliament that he did not authorise anyone to purchase any votes to survive the July 22, 2008 vote of confidence over the Indo-US Nuclear deal. But as luck would have it, Wikileaks revealed that all the alleged fixers were closely aligned with Sonia Gandhi and her family; it particularly highlighted the role played by Satish Sharma and his aides.
Vadra’s growing wealth, however, hit the headlines only in 2013 when Arvind Kejriwal and Prashant Bhushan of India Against Corruption (doubtless as a calibrated move in their political career which unfolded thereafter) exposed the fact that Vadra had acquired land in and around the National Capital Region worth hundreds of crores of rupees, sometimes at prices below market value — funded by interest-free loans disbursed by DLF and other companies for no obvious reason.
The question legitimately arises why a publicly traded firm like DLF would enter into multiple business transactions with Vadra on such highly preferential terms. Media reports show that Robert Vadra’s financial graph grew steeply; in 2007-08, he launched his six group companies with promoter funds of just Rupees 50 lakhs. But these companies acquired 29 high-end properties by 2010, thanks to loans and advances of Rupees 80 crore from DLF and others such as Bedarwals Infra Projects, Nikhil International and VRS Infrastructure. He also acquired 50 per cent share of the Rupees 31.7 crore worth Saket Courtyard Hospitality which owns the 114-bed Hilton Garden Hotel in New Delhi; a 10,000 square foot penthouse (B1115) at DLF Aralias complex for Rupees 89.41 lakhs; 7 apartments in DLF Magnolia for Rupees 5.2 crore; apartments for Rupees 5.06 crore at DLF Capital Greens; and a DLF-owned plot in Delhi’s ultra-posh Greater Kailash II area for Rupees 1.21 crore.
These investments are stated in the balance sheets filed by Robert Vadra’s companies with the Registrar of Companies, a practice he stopped after the controversies surfaced.
By the end of 2010, Robert Vadra’s firms made huge rural purchases: 160.62 acres of agricultural land in Bikaner for Rupees 1.02 crore; Rupees 2.43 crore for an additional 5 parcels of land (amount not stated); land at Manesar for Rupees 15.38 crore; land at Palwal for Rupees 42 lakh; land at Hayyatpur, Gurgaon, for approximately Rupees 4 crore; land at Hasanpur for Rupees 76.07 lakh; land at Mewat for Rupees 95.42 lakh; unidentified agricultural land for Rupees 69.09 lakh; and two ‘other real estate bookings’ worth Rupees 9 lakh.
All these purchases were made with funds of just Rupees 50 lakh; Vadra also earned interest to the tune of Rupees 255.46 lakh thanks to the advances and loans received. Analysis of the financial information in the balance sheets and directors’ reports of Vadra’s firms make it difficult to understand what business they actually do, and how this business is conducted. However, each company has 268 Sukhdev Vihar, New Delhi, as its common address, and Robert Vadra and his mother Maureen Vadra as directors. The former also receives remuneration of Rupees 60 lakh per annum from just Sky Light Realty. There are no other employee costs in the books.
Since Robert Vadra and DLF have avoided questions about their close nexus, it took a small error by a since discarded official, Amit Mehta, to disclose the direct link between the two. When Vadra set up six new firms in 2012, Mehta was his non-executive director (Director Identification Number 03105957) in five companies and innocently gave his email id as corporateaffairs@dlf.in, to the Registrar of Companies (RoC). This just happens to be the common email id furnished by all DLF Group Directors to the RoC.
One of the new firms is Greenwave Agro Private Limited; the others are Lifeline Agrotech Private Limited; Rightline Agriculture Private Limited; Future Infra Agro Private Limited; Best Seasons Agro Private Limited; and Primetime Agro Private Limited. Vadra is Promoter and Managing Director (DIN no. 01840634); his email id isartex@artexrv.com. These, along with the six previous firms, have Active status as per the Ministry of Corporate Affairs, Government of India.
As Robert Vadra set up his new firms around the time of the scam involving de-classification of the Keventer Dairy Ltd lands for residential use in the vicinity of Rashtrapati Bhavan, BJP leader Subramanian Swamy urged President Pranab Mukherjee to demand a probe into the affair. Swamy argued that change in land use in such a prime location was not possible without political influence and gave windfall profits to the DLF.
The latest controversy also brought to light the surprising fact that Priyanka Vadra has three DINs – 01038703, 01840144 and 02914391 – which is a violation of the Company Act and the Income Tax Act. She had previously resigned from one of the Robert Vadra’s firms – Blue Breeze Trading Private Limited – that she was associated with, and a firm floated by Rahul Gandhi, Backops Services Ltd, was closed down. To this day, there is no clarification about why Priyanka Vadra has three DINs and which firms she received these identifications for; certainly they do not reflect on the Ministry’s website. Her mother-in-law Maureen Vadra has two DINs – 01840680 and 01839769. None of Vadra’s new companies has so far filed balance sheet or annual accounts with the RoC.
Several legitimate questions arise. Far from answering these, Sonia Gandhi, Rahul Gandhi and Priyanka Vadra have attacked BJP’s Prime Ministerial candidate Narendra Modi in very loose language and held themselves to be above accountability. This will not wash. As a beginning, they must answer the virtual chargesheet presented before the nation by BJP Spokesperson Ravi Shankar Prasad.
As per the evidence available, Robert Vadra floated Skylight Hospitality as a registered company in November 2007 with Rupees one lakh equity capital. In February 2008, the Company registered the purchase of 3.531 acres of agricultural land in village Shikohpur, Sector 83, Gurgaon for Rupees 7.5 crores using a false cheque (No. 607251) as payment to vendor M/s Onkareshwar Properties (deed No. 4928 dated February 12, 2008).
The deed claimed that Rupees 45 lakhs towards stamp duty was paid in cash by M/s Skylight Hospitality. But actually, advances received from M/s DLF were used to pay for the cost of land and stamp duty later on August 9, 2008, and the land with commercial colony license permission for 2.701 acres was sold to DLF for Rupees 58 crores. As per clause 3(a) of a collaboration agreement dated August 5, 2008, possession of the land was already handed over to the DLF.
The Letter of Intent for commercial colony license was issued within 18 days of application by the licensing authority, Director Town and Country Planning Haryana, on March 28, 2008. The commercial colony license, applied on November 18, 2008, was granted on December 15, 2008 and renewed on January 18, 2011 and permitted to be transferred on April 3, 2012. The fortunes of all involved parties soared exponentially.
The BJP has asked Sonia Gandhi, Rahul Gandhi and Robert Vadra to come clean on the latter’s land deals and business practices. How, for instance, with a cash and bank balance of Rupees 1 lakh did his Skylight Hospitality issue cheque no. 607251 for Rupees 7.5 crores to M/s Onkareshwar Properties on February 9, 2008? And who paid the Rupees 45 lakhs in cash towards stamp duty on February 12, 2008?
Who are the beneficial owners of Onkareshwar Properties and what was the quid pro quo for the sweetheart deal with Skylight Hospitality? Why did DLF Retail Developers pay Skylight Hospitality advances of Rupees 6.5 crores on June 5, 2008, Rupees 1 crore on June 10, 2008 and Rupees 0.55 crore on June 12, 2008?
Was Onkareshwar Properties paid Rupees 7.95 crores (Rupees 7.5 crores towards cost of land and Rupees 45 lakhs towards stamp duty) on August 9, 2008 (vide cheque no. 978951) after receiving advances from DLF as above?
Similarly, the Haryana Government must answer what assessment was made of the technical and financial capacity or intent of Skylight Hospitality to develop over two lakhs square feet of commercial complex before issuing the Letter of Intent. Why did the licensing authority entertain an unregistered Collaboration Agreement dated August 5, 2008 between Skylight Hospitality and DLF Retail Developers to develop a commercial complex at the site, when this was against the provisions of the Registration Act and caused loss of crores in revenues to the State?
Why was the commercial colony license issued to Skylight Hospitality when it was clear in the application for grant of license and other correspondence that the actual developer would be DLF Retail Developers (renamed DLF Universal)? Under what statute was the colony license permitted to be transferred and sold?
Since the land transfer was completed before August 2008, was tax paid by Skylight Hospitality in the AY 2009-10 (FY 2008-09) on short term capital gains of Rupees 50 crores which accrued to the company? If not, what penalty proceedings have been initiated against the company by the Income Tax authorities? And what led to the scuttling of the thematic audit, “Issue of licenses for development of colonies etc. after release of land” in Haryana by the Comptroller and Auditor General on June 3, 2013?
The BJP has listed in detail the likely offences involved under various sections of The Prevention of Corruption Act, 1988. It has detailed the violations in the Haryana Ceiling on Land Holdings Act, 1972. The legitimate question arises why no action taken against Robert Vadra for any of the offences involved.
Worse, even as the institutions of the State and their statutory apparatuses were compromised, honest and sincere officers were discriminated against and hounded. However, the IAS officer who handled change in land-use and colony license permissions for nine years from 2005 to 2013 in the office of the Chief Minister of Haryana was appointed Member, UPSC, in September 2013, a few months after his retirement. The officer retired in the rank of Additional Secretary and Member UPSC is normally given to officers in the rank of Secretary to the Government of India. Obviously, some considerations weighed in the appointment.
Ashok Khemka’s statutory order of October 15, 2012 cancelling the land mutation between Skylight Hospitality and DLF Universal has not been implemented. Instead a committee of three IAS officers was appointed to clean up the mess.
Robert Vadra, meanwhile through his various companies, purchased about 1634 hectares of land in Rajasthan’s Bikaner district between June 2009 to August 2011, where solar energy was to be promoted and a solar park established under the solar policy of the Rajasthan Government. More than 700 companies have registered themselves with a proposal to generate more than 16,000 MW of solar power.
For this, the Government of Rajasthan was to establish a land bank and give incentives to investors; Robert Vadra conveniently purchased most of the land near the Highway or near grid sub-stations, knowing its value would sky rocket. Companies were then forced to purchase land from Vadra’s companies at huge cost. The then Rajasthan Government helped Vadra further by amending the Agriculture Land Ceiling Provision from the maximum of 175 acres in desert zone (Vadra purchased 1634 acres) and allowing solar power firms to avail of exemption beyond the permissible limit.
In the process, poor farmers were cheated of their legitimate dues and Robert Vadra allowed to trade with huge chunks of land and to enrich himself in violation of law, which is clearly punishable.
These are legitimate questions that those rambling about child marriage and unsubstantiated allegations of snooping on private citizens are honour-bound to answer. Meanwhile, as he prepares to walk into the sunset, there is no doubt that Manmohan Singh is having the last laugh.