Corporate Nov 17, 2012
If ever there ever was a paisa vasool western, one candidate for it would be Butch Cassidy and the Sundance Kid, which starred Paul Newman and Robert Redford. The film, other than having great visuals, a fast-paced story line, brilliant background music and excellent performances by its lead cast, also had what is my favourite one liner from an English movie.
In a rather non-descript scene as Butch and Sundance head into the sunset, Butch says "Boy, I got vision, and therest of the world wears bifocals."
Nowhere is the statement truer currently than in the case of Robert Vadra, who has earned hundreds of crores without putting much of his own money at risk. As a line from a song in the movie Gol Maal (the original one made by Hrishikesh Mukherjee and not the recent Rohit Shetty series) goes, "Ke paisa kamane ke liye bhi paisa chahiye".
Vadra broke the age-old wisdom inherent in the phrase. He had the vision of figuring out how to make profits of hundreds of crores by putting very little of his own money into the business.
Of course this clarity of vision wouldn't have been possible to execute if he was not married to Priyanka Gandhi (now Vadra), India's perennial politician in waiting, a spare tyre if Rahul Gandhi develops a puncture.
The story started with Sky Light Hospitality, a company in which Vadra owns a 99.8 percent stake, zeroing on 3.5 acres of land in Shikohpur, 10 km from Gurgaon, in February 2008. This land was bought from Onkareshwar Properties, then majorly owned by Satyanand Yajee, a man known to be close to Haryana Chief Minister Bhupendra Singh Hooda.
Yajee sold the land to Vadra for Rs 7.5 crore. The balance-sheet of Vadra's Sky Light Hospitality as on 31 March 2008, clearly reveals that the company had a capital base of only Rs 1 lakh. Also the company did not have any loans on its books. So how did a company with a capital of Rs 1 lakh buy a piece of land worth Rs 7.5 crore? Over and above this stamp duty also needed to be paid, where did that money come from?
Vadra's Sky Light Hospitality issued a cheque without having the requisite money in its bank account. Yajee did not deposit the cheque and supposedly also paid up the stamp duty. Soon Vadra sold the piece of land to DLF which valued it at Rs 58 crore. DLF gave an advance of Rs 50 crore on this. The first Rs 5 crore of this advance was paid out in early June 2008.
This money was used by Vadra to pay off Yajee. He also used the money to go on a major property buying spree across Rajasthan and Haryana, two states ruled by the Congress party and made a killing on it.
But some recent revelations made by Outlook magazine show that Vadra could not have sold the land to DLF in the first place. "Documents seen byOutlookreveal that, till recently, the land did not have the required permission to be sold, leased or used for any other purpose (than for which it was sold to the buyer). In short, Vadra's company (Sky Light Hospitality) could not by law sell the land (as it claims to have done in 2008) to DLF," the article points out.
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