Realty check for Robert Vadra?

Photos: AFP

NO ONE would want to be in Robert Vadra’s shoes today. Caught in the middle of allegations of questionable dealings with a corporate giant, the son-in-law of Congress President Sonia Gandhi is faced with the unenviable task of having to prove that his deals are transparent and free of political interference. Curiously, in jumping to his defence, the Congress finds itself dragged into a debate many commentators feel it would have been more wise to avoid.

On 5 October, in a press conference held in New Delhi, India Against Corruption (IAC) activists Arvind Kejriwal and Prashant Bhushan slammed Vadra for his alleged dealings with premier real estate company DLF. They alleged that DLF had given Vadra an unsecured interest-free loan of Rs 65 crore in return for favours, or at least in the hope of favours, which the IAC wants investigated. According to papers produced by the IAC duo, five companies owned by Vadra and his mother, Maureen, had purchased 31 properties in 2007-10. These include a 50 percent share in the Hilton Garden Inn in Saket, Delhi, for Rs 31.7 crore (current value Rs 150 crore or more), a 10,000 sq ft flat in DLF Aralias, Gurgaon, for Rs 89 lakh (current value Rs 25 crore), seven flats in DLF Magnolia, Gurgaon, for Rs 5.2 crore (current value over Rs 100 crore). The balance sheets ofc show the total share capital of these five companies as Rs 50 lakh. No source of revenue has been shown.

Kejriwal and Bhushan claim that the real value of the properties is Rs 300 crore. This rise of Vadra’s fortunes — from Rs 50 lakh to Rs 300 crore — is what the IAC has questioned and claimed as the basis on which charges of a quid pro quo could be established. The current value of these properties, they say, is over Rs 500 crore.

A day after these charges were levelled against him, Vadra issued a statement dismissing them as “false, entirely baseless and defamatory”. “My business transactions are fully reflected in financial statements filed before government authorities and are in the public domain,” he said, before adding that it was all being orchestrated by Bhushan and Kejriwal to “garner cheap publicity at the launch of their political party”.

After a gap of three days, on 9 October, Kejriwal came out all guns blazing, this time to establish an alleged nexus between the Haryana government and realty major DLF, something they claimed facilitated the “malafide nexus” between Vadra and the realty major.

Kejriwal alleged that the Haryana government had transferred 30 acres of land acquired in public interest for a hospital to DLF SEZ Holdings Pvt Ltd instead to set up a Special Economic Zone, a transfer that was challenged in the Punjab and Haryana High Court, which reversed the decision. Citing the court observation that remonstrated the state government for favouring DLF on the “pretext of public purpose”, the IAC leader demanded an FIR be lodged against Vadra under the Prevention of Corruption Act and an independent Special Investigation Team (SIT), comprising retired judges of the Supreme Court, be set up to probe these deals. The charges also say that Vadra was a majority stakeholder in DLF SEZ Holdings, and that he later sold his shares back to the company.

In its defence, DLF has claimed that the Rs 65 crore was part of a payment to Vadra for a 3.5 acre piece of land they bought from him in Haryana. But dismissing these claims by DLF, the IAC member rebutted: “Is it normal business practice to give an advance of 90 percent and let it remain with the seller for more than two years without even bothering to take possession of the land?” Vadra’s own books, he says, show the Rs 65 crore as an “unsecured” loan contrary to DLF claims that they loaned him the money in return for land.

Continuing his attack on the state government, Kejriwal raked up the issue of a 350-acre golf course that he alleged is an example of the rigging that took place. The IAC member explained how the terms of bidding were tweaked to introduce the clause of “experience” to favour DLF over two other players, Unitech and Country Heights, even though they were willing to pay more for the land.

Both the Haryana government and DLF have hotly refuted these allegations. Chief Minister Bhupinder Singh Hooda has rubbished the claims of unduly favouring DLF by giving them land at concessional rates. “Our process is transparent and there was no favour given to anybody. The land was given to the highest bidder,” says the CM.

The DLF Group defends itself by saying it bought the land either through auction or piecemeal from the farmers. It also adds that no unsecured loan was given to Vadra. The golf course issue, it claims is also above board. The technical bids disqualified other bidders, and so, there was no need for financial bids. On the issue of the court order against DLF SEZ Holdings Pvt Ltd, it said the matter is now with the Supreme Court.

DESPITE THE high-octane subject, the IAC’s charges have had a mixed reception among commentators. Former CVC N Vittal, for instance, is not convinced of Kejriwal’s charges. “Kejriwal is converting a movement into a political party and he is in a hurry,” he says. Vittal is of the view that these are attention-drawing tactics and till there is documentary proof, nothing can be done.

The demand for an SIT too is being dismissed by some as irrelevant. “Both DLF and Vadra are private entities, so the Prevention of Corruption Act does not apply,” says former CBI director Joginder Singh. “At best, they can be investigated by the Income Tax Department.” Singh further adds that though “it appears the properties were sold at concessional rates”, it is very difficult to prove these allegations.

IAC member Shanti Bhushan, though, has refuted the logic of that claim. According to him, a case can be made against Vadra based on sections of the Prevention of Corruption Act and the Evidence Act. But curiously, the senior lawyer’s logic is refuted by others in the legal fraternity. Supreme Court advocate Rajeev Dhavan, for one, maintains that since Kejriwal cannot prove any wrongdoing to the public for these transactions, the charges are defamatory and politically and morally unfair. “Vadra is a private individual with no public status,” says Dhavan, echoing Joginder Singh’s sentiments.

By rushing to Vadra’s defence, the Congress finds itself pushed into a corner of its own making

However, former Lokayukta of Karnataka and former IAC member, Santosh Hegde feels differently. “A serious investigation must be carried out as these do not appear to be normal commercial transactions,” says he. Former cabinet secretary TSR Subramanium also agrees that the balance of proof has shifted as Vadra has special privileges by virtue of being related to the Gandhis. “Both DLF and Vadra have to come clean on this, chapter and verse,” he says, “otherwise, Vadra may be convicted in the court of public opinion.”

As for the Congress, the court of public opinion might, after all, prove to be its real test. In what many are terming a self-inflicted wound while others interpret as a sign of culpability, the party has jumped to Vadra’s defence and brushed aside all questions of an inquiry. “An inquiry into what?” said Congress spokesperson Manish Tewari. “Is a business transaction between two private entities that has been duly reported to the statutory authorities, illegal?”

Crusaders Kejriwal (left) and Bhushan
Crusaders Kejriwal (left) and Bhushan
Photo: Dijeshwar Singh

If that is the party’s position, many would ask why have senior Congress functionaries and ministers been reacting to Kejriwal’s allegations against Vadra, who is not even a party member? Going by these reactions, the entire Congress party seems to have taken umbrage to the charges. “The demand for an inquiry is a clear indication that they want to make the country a probocracy rather than a democracy,” says Union Law Minister Salman Khurshid. Joining him, Corporate Affairs Minister Veerappa Moily adds that “every maligning campaign cannot be followed by an investigation”.

The Opposition has used the issue to slam Vadra and by implication, the Congress. “The people of the country expect the matter to be investigated,” says BJP spokesperson Ravi Shankar Prasad. “There should also be a probe on the benefits Congress state governments in Rajasthan, Haryana and Delhi gave Vadra.”

Kejriwal had earlier made allegations against 15 ministers of the Union Cabinet, which are yet to be proved. Neither has he gone to court with the details. This time around, if the Vadra-DLF allegations are not proved, it could take some of the sheen off his yet-to-be-named party.

However, either way, by raising the issue of the Vadra-DLF deal, the IAC has raised some important questions about public propriety, and broken through the unspoken idea of political ‘holy cows’. It has also put a spotlight on the nature of land deals routinely struck in the country. Kejriwal has already hinted that he is gearing up for another exposé involving three major companies — Indiabulls, BPTP and the GMR Group. All of this highlights the way big businesses use money to woo political influence, regardless of the actual efficacy of that influence.

Is any corporate house or political party exempt from either? Can it afford to be? While these questions will continue to rankle the collective conscience, now with the Trinamool Congress and the Samajwadi Party also joining the chorus for a probe into the Vadra-DLF deal, the Congress might do what it should have done earlier: stop acting like a family and start acting like a party.

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