Cong admits it gave loan to help revive defunct paper

Hours after the BJP demanded a straight answer to Subramanian Swamy's allegations against Sonia and Rahul Gandhi, and Swamy dared Rahul to sue him, the Congress conceded that it had given an "interest-free loan" to The Associated Journals Ltd as part of its "duty" to help revive the defunct National Herald.

In a statement issued late Friday evening, the Congress justified the loan it had given to the company before its shares were allegedly transferred to a Section 25 company, Young Indian, in which Sonia and Rahul have 38 per cent each.

"In furtherance of its objective and its political activities, it is a matter of pride for the Indian National Congress that it has supported The Associated Journals Limited, publisher of the National Herald... founded by Pandit Jawaharlal Nehru... The Congress has done its duty in supporting The Associated Journals Limited to help initiate a process to bring the newspaper back to health... This support was extended... in the form of interest free loans from which no commercial profit has accrued to the Congress," the party's media department chairman Janardan Dwivedi said in the statement.

Janata Party chief Swamy alleged on Thursday that the Congress had given unsecured loans to the tune of Rs 90 crore to The Associated Journals, which he said was illegal under the Income-Tax Act. Swamy had also alleged that Young Indian wrote off the loan due to the Congress for just Rs 50 lakh, and that by a board resolution, Associated Journals was sold by a transfer of shares to Young Indian.

Speaking in Shimla earlier, senior BJP leader Arun Jaitley asked the Congress for a straight answer to questions raised by Swamy, instead of merely repeating that the charges were "baseless" and "untrue".

For, Jaitley said, if Swamy's allegations were true, they amounted to the "gravest violation (by the Congress) of income-tax exemptions to political parties, and also electoral laws".

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