Track2Realty: The allegation that businessman Robert Vadra and real estate giant DLF have deep illicit links, where Vadra was given an interest-free loan from DLF, which also sold him vast amounts of property at hefty bargains in return for favours from the Congress, could not offer evidence of a quid pro quo.
The business transaction between DLF and Vadra could not be established as DLF funding the later. However, the fact that Vadra is married to Priyanka Gandhi, the daughter of Congress president Sonia Gandhi who is also the chairperson of the UPA, the ruling coalition, made it more of a political slug fest than any investigation on the DLF.
“All businessmen take loans to build their business. Maybe Robert Vadra also did that. What is wrong with that? But there is nothing to prove any wrong-doing…no proof that the Congress helped out DLF,” said Congress leader Rajiv Shukla.
Activist-turned-politician duo Arvind Kejriwal and Prashant Bhushan said DLF sold under-valued flats, many of them in Haryana, its main market, to Vadra. In exchange, they alleged, the Congress party gave the developer vast amounts of land in states like Haryana where the party is in power. Some of this land, they said, had been acquired from farmers for public projects.
The activists also said that clearances and permissions were given to DLF projects at lightning speed. Haryana Chief Minister Bhupinder Singh Hooda refused to comment on the allegations levelled by the activists.
The BJP predictably seized the allegations to target the Congress and said the party should not dismiss the accusations without a detailed investigation. “The UPA Chairperson’s home has been turned into a place to make real estate deals,” said the opposition party’s spokesperson, Mukhtar Abbas Naqvi.
However, market & political analysts are unanimous that the activists have offered no evidence of a quid pro quo between Vadra and DLF, but the problem for the party will lie in how to counter perception. After a series of lurid financial scandals, the UPA is being seen at home and abroad as a government entangled in graft.
The BJP has made corruption one of the cornerstones of its campaign ahead of elections in states like Gujarat, and will build on this for the general elections scheduled for 2014.
The activists allege that about five years ago, DLF gave Vadra an interest-free loan of 65 crores. Vadra’s five companies, which on paper were worth 50 lakhs, say the activists, used this loan to buy DLF properties. They say thaty from 2007 to 2010, Mr Vadra bought property that was worth 300 crores and is valued at 500 crores today. “How did he afford this?” they asked. “What was DLF’s interest in giving him hugely-discounted properties?”
They claim that DLF was given land reserved for public-interest projects by the Congress government in states like Haryana, and that DLF received clearances at lightning speed.
As an example, they cite the fact that Vadra allegedly got seven apartments at massively discounted rates in a housing project called Magnolia in Gurgaon near Delhi. The developer had been given 350 acres by the Haryana government for this project. “Is that the quid pro quo for DLF giving Vadra the seed money for the purchase of these massive properties worth hundreds of crores?” they asked.
The activists also alleged that Vadra has registered six new companies in 2012. They asked about the source of funds for these new companies. “Are illicit funds of the Congress party being funnelled into this property-buying spree?” they added.
An analysis of the balance sheets and audit reports of Vadra’s companies (owned exclusively by him and his mother) show the total share capital was just Rs50 lakh in November 2007. “In three years they acquired properties that are worth more than Rs500 crore today,” he said. “An auditor who looked at the balance sheets said none of these companies were involved in any other business activities during these years.”
Initially, Vadra’s wife Priyanka too was part of some of his companies. She later quit. Kejriwal and Bhushan said the information had been sourced from the registrar of companies.
Citing the example of Sky Light Realty Private Limited, a company owned by Vadra, that bought a 10,000 square feet apartment in DLF Aralias, Gurgaon, for Rs 89 lakh whose market value at the time of purchase in 2010 was Rs 25 crore, the activists said the current value was about Rs 40 crore.
In another instance, seven flats were bought by the same company at DLF Magnolia, Gurgaon (Harayana), for Rs 5.2 crore. Bhushan and Kejriwal alleged that the market value of these flats at the time of purchase was in the range of Rs35-70 crore. At present it is in the range of Rs 105-175 crore.
They alleged that the Congress-led Haryana government had given nearly 350 acres of land to DLF for this project. The land had been acquired by the state government from farmers on the pretext of doing some industrial projects.
“Is that the quid pro quo for DLF giving Vadra the seed money for the purchase of these massive properties worth hundreds of crores?” Bhushan asked. “A stake of 50% share in the DLF-owned hotel in Saket (DLF Hilton Garden Inn) is shown to be bought for Rs32 crore when the market value was well over Rs150 crore.”
