Why has Robert Vadra not filed financial returns since 2011?

Sonia Gandhi's son-in-law Robert Vadra, already in the eye of a political storm for his dubious land deals, has since March 2011 stopped filing mandatory annual returns or financial statements with the ministry of corporate affairs of all the 13 companies he owns. The reason? He may have panicked as his "business model and land deals" have raked in huge controversy and the BJP has been gunning for him during the election campaign.

In March 2011, a controversy had erupted over Vadra using DLF money to buy land in Haryana and for his bulk purchase of desert land in Rajasthan. He had disclosed both the facts – DLF's unsecured loans and bulk land purchase – in his financial statements submitted to the ministry till March 2011. However, since then, Vadra has not been filing financial statements.

dna checked the records of Vadra's 13 companies available with the corporate affairs ministry and found that he had not been filing financial statements of seven companies for the past two years. In the case of the remaining six companies, Vadra incorporated them in a span of three months (July to August 2012) and did not submit information about their financial deals. All six companies have some 'Agro' link and have most probably been raised to buy rural land, sources said.

Interestingly, his wife Priyanka Gandhi, who staunchly defended Vadra recently, had helped him incorporate one of the companies - Blue Breeze Trading Private Limited - in November 2007. Priyanka, however, gave up her directorship in the company within eight months of its incorporation; her mother-in-law Maureen Vadra then moved in as director. Blue Breeze is filing its annual returns.

As per the ministry of corporate affairs rules, Vadra has defaulted for two consecutive years and if he does not file the returns for the third year in succession, the ministry may take action against him and all the companies where he is one of the directors. The action ranges from a minimum fine of Rs50,000 or Rs5,000 per day till the financial statement is filed. The minimum fine is levied only if the company has justifiable reasons for not filing the returns, ministry sources said.

"Robert Vadra's act is not so much driven by the fear of the ministry's action. He can handle that by paying hefty fine. The fear of further exposure of his business or land deals in the media has perhaps stopped him from making his financial statements public," a senior ministry official said.

Vadra does not want any further leak of his future or ongoing business plans.

Four of Vadra's companies -- North India IT Parks Private Limited, Real Earth Estates Private Limited, Sky Light Realty Private Limited, Sky Light Hospitality Private Limited - are under the scanner for land deals in Rajasthan, where he has reportedly bought several thousand acres of land at throwaway prices. The value of the land shot up drastically as eight months after the deals, the ministry of non-conventional and renewable energy announced the Jawaharlal Nehru National Solar Mission Policy under which huge subsidies were offered for setting up grid tight solar plants. The BJP government in the state ordered a probe which would be expedited after Lok Sabha elections.

Vadra's six new companies are apparently all Agro-based and may be dealing in land transactions and agricultural technology, as the names suggest, in the absence of any financial details or returns. None of these companies has filed annual returns or balance sheets since inception.

Sources in the revenue intelligence disclosed that many companies have opted for not filing their financial statements for years in the past. Their investigations reveal that such companies primarily indulge in handling their black money. "They raise black money from one company and route it to other companies. Once they settle their finances, they start rolling out financial statements,'' said a revenue intelligence source.

Another possibility in Vadra's case could be that he is winding up some of his companies which were embroiled in controversy. "He may cite bad financial health of these companies and can opt for Fast Track Exit through the ministry of corporate affairs,'' the source said. "Many companies wind up their old companies on financial grounds and route their money into new companies."

In three months in 2012, Vadra floated six new companies, but their details are so bare that one can only risk to speculate.