Newsclick FIR a ‘Gross Abuse’ of Legal Process, Delhi High Court Says

From the Editor’s Desk

June 11, 2026

Newsclick founder Prabir Purkayastha; Screenshot/X

The Delhi High Court has quashed a police case and a money laundering investigation against the independent news portal Newsclick, ruling that nothing in the complaint amounted to a crime even if every claim in it were true, and that letting the prosecution continue would be a gross abuse of the process of law.

Justice Neena Bansal Krishna pronounced the verdict on May 29 on three connected petitions filed by PPK Newsclick Studio Pvt. Ltd., the company that runs Newsclick, and its founder Prabir Purkayastha, according to the court order seen by Newsreel Asia. Newsclick and Purkayastha had argued before the court that the cases were “an arbitrary attack and abuse of powers on the free and impartial journalism” of the company, meant to silence independent reporting and chill journalists.

The Economic Offences Wing, or EOW, the financial crimes unit of the Delhi Police, registered a First Information Report, or FIR, against the company on Aug. 26, 2020, invoking cheating, criminal breach of trust and criminal conspiracy provisions of the Indian Penal Code. The Enforcement Directorate, or ED, India’s central financial crimes agency, opened its own case on Sept. 2, 2020, under the Prevention of Money Laundering Act, or PMLA.

The police acted on a complaint from a man named Sobhan Singh, forwarded by the Ministry of Information and Broadcasting. It alleged that Newsclick received foreign direct investment, or FDI, of $1.5 million from Worldwide Media Holdings LLC, a company registered in the U.S. state of Delaware, on April 11, 2018, in exchange for 7.69% of its shares.

Newsclick sold the shares at 11,510 rupees each. Their base value was 10 rupees. At that base price, the investor’s $1.5 million would have bought 98% of the company, far above a 26% ceiling on foreign ownership of digital news outlets. The complaint claimed the price was inflated so the same money bought only 7.69%, keeping the deal under the ceiling. It also claimed more than 45% of the money was siphoned off as salaries, consultancy fees and rent.

The court rejected each allegation. The 26% ceiling did not exist when the money arrived. The government brought it in through a press note on Sept. 18, 2019, more than a year after the investment, so there was no rule for Newsclick to evade.

Chartered accountants had valued the shares at 9,188 rupees each. Indian foreign exchange rules barred the company from selling shares to a foreign investor below that valuation. The final figure of 11,510 rupees came out of negotiations between the two companies, and the judge held that agreeing on a higher price was a business decision involving no crime.

On the siphoning charge, the judge said expenses on salaries, consultancy and rent are bound to occur when a company operates in digital media, and the allegation was untenable even if excessive expenditure were accepted.

The court also noted that Worldwide Media Holdings, the only party that paid money, never complained of being cheated, while the complainant, Singh, was merely an informant. For the offence of cheating to arise, there must be an aggrieved person deprived of valuable property, the judgment said.

In July 2021, the EOW emailed Newsclick’s lawyers an advance copy of its investigation report. It quoted the Reserve Bank of India, or RBI, telling the police that the investment came in through the automatic route, a channel needing no government approval, and broke no foreign exchange rules. The police never placed the report on the court record. At a hearing days later, they disowned it and asked for time to file a fresh one. The version filed in court in October 2021 had the RBI reply removed, without explanation. The judge said the deleted reply was enough to show Newsclick had not broken the rules.

ED teams searched Newsclick’s offices and the premises of its employees, directors and shareholders from Feb. 9 to 13, 2021. In its report to the court, the Delhi Police said scrutiny of Newsclick’s accounts found foreign money flowing in from several more sources until October 2020. The largest sum it listed was roughly 275 million rupees, about $3.2 million, from an American organisation, Justice & Education Fund Inc.

Money laundering means hiding the origin of money earned through crime. If no crime produced the money, there is nothing to launder. With the cheating and breach of trust charges struck down, the ED told the court the crime was a criminal conspiracy between Purkayastha and two men it named, Jason Pfetcher and Neville Roy Singham. The judge rejected that too, noting that the conspiracy charge came with no evidence behind it. The judge said that about a year and a half of investigation, with repeated summonses and questioning of employees, produced nothing incriminating on record.

Relying on the Supreme Court’s ruling in Vijay Madanlal Choudhary and a division bench decision of the Delhi High Court, the judge held that a money laundering case cannot survive once the FIR for the underlying offense is quashed.

A third petition asked the court to order the ED to give Newsclick a copy of its case file, which the agency had never handed over. Once the case itself stood quashed, there was nothing left to ask for, and the judge closed the petition.

Newsclick was founded in 2009 and is known for covering progressive movements. It began as a trust, became a partnership in 2015, and turned itself into a private limited company in January 2018 so it could take foreign investment. Before the deal, the company had asked the Information and Broadcasting Ministry whether the foreign investment limits on print media covered online news, and was told that they did not. The judge cited that reply in ruling that the investment agreement broke no law.

In a statement on June 11, Newsclick said, “Newsclick has always maintained that the numerous cases and charges against it are attacks on the freedom of the press. Newsclick’s only ‘fault’ has been to practice journalism that covers people’s movements.”

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