Delhi HC Quashes NewsClick FIR, ED Case Citing 'Gross Abuse of Law'

The Delhi High Court has delivered a significant judgment, quashing a First Information Report (FIR) registered by the Economic Offences Wing (EOW) of the Delhi Police and the subsequent Enforcement Directorate (ED) case against the digital news portal NewsClick and its editor-in-chief, Prabir Purkayastha. The High Court, in its ruling made public on June 10, 2026, declared that the continuation of these proceedings constituted a "gross abuse of the process of law" and was an "arbitrary attack and abuse of powers on the free and impartial journalism" of the petitioners. The cases were primarily based on allegations of violations of Foreign Direct Investment (FDI) norms and subsequent money laundering charges. The EOW had filed an FIR in August 2020, alleging that NewsClick had received ₹9.59 crore in FDI from the US-based Worldwide Media Holdings LLC through an allegedly overvalued share transaction, intended to circumvent foreign investment regulations. It was also alleged that a substantial portion of these funds was siphoned off through salaries, consultancy fees, and other expenses. This FIR formed the basis for the ED to initiate proceedings under the Prevention of Money Laundering Act (PMLA), leading to the registration of an Enforcement Case Information Report (ECIR) and subsequent searches in February 2021. However, Justice Neena Bansal Krishna, presiding over the case, found that the essential ingredients of the offenses of cheating (Section 420 of the Indian Penal Code) and criminal breach of trust (Section 406 of the IPC) were not made out, even if all allegations in the FIR were accepted at face value. The court critically examined the FDI aspect, noting that the investment agreement was signed in March 2018, and the funds were received in April 2018, which was over a year before a 26% cap on foreign investment in digital news media was introduced through a government press note on September 18, 2019. The court also noted that at the time of the investment, there were no specific caps on FDI in digital news media. Furthermore, the court observed that the ED had failed to produce any substantial incriminating material despite extensive investigations, stating there was "not a whisper of any incriminating allegation" to suggest the commission of an offense under Section 4 of the PMLA. The court also held that the ED's money laundering case could not survive once the predicate offense (the FIR) was quashed, referencing the principle that PMLA proceedings founded on a collapsed predicate offense cannot be sustained. The judgment highlighted that the proceedings appeared to be "mala fide" and aimed at targeting independent journalism. The court's strong remarks have been widely interpreted as a significant affirmation of press freedom in India, providing a judicial check against the potential overreach of investigative agencies. Prabir Purkayastha had previously been arrested in October 2023 under the Unlawful Activities (Prevention) Act (UAPA) in a separate case, but was later released by the Supreme Court in May 2024, which declared his arrest invalid due to procedural lapses. While this specific FIR and ED case have been quashed, the broader implications for other ongoing investigations against NewsClick and its founder remain to be seen.

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