The NewsClick Judgment: Judicial Rebuke and the Cost of Press Prosecution
The Delhi High Court ‘s order on Wednesday on the Delhi Police Economic Offences Wing (EOW) and Enforcement Directorate (ED)’s cases against the online portal NewsClick and its founder-editor Prabir Purkayastha was on the expected lines. The court said the Delhi police had ‘indulged in a gross abuse of the process of law’ and quashed the proceedings by the two agencies. The HC’s verdict raises once again serious question about the motives and competence of the investigating bodies and the prosecution. Editor-in-Chief Purkayastha, who spent seven months in jail, still faces cases under UAPA and income tax laws.
The court did not mince its words. It observed that the ED proceedings were “not only mala fide, but also an arbitrary attack and abuse of powers on the free and impartial journalism of the Petitioners …. apart from bald assertion of there being a criminal conspiracy, there was not a whisper of any incriminating allegation….the continuation of the FIR registered by the Delhi Police’s EOW was ‘nothing but a gross abuse of the process of law.”
An Arbitrary Attack on Independent Journalism
The ruling comes nearly six years after the FIR was first registered. Justice Neena Bansal Krishna held that even accepting the state’s allegations in the entirety, the essential ingredients of the charged offences were not made out. The NewsClick channel has since been closed and over a hundred employees have been deprived of their jobs. The website is still there. Former union minister Anurag Thakur was making allegations on the NewsClick as though it was being run by China through proxy. Another controversial BJP MP Nishikanth Dubey also called the journalists working for NewsClick as Chinese agents.
News Click in a statement said, “it has always maintained that the numerous cases and charges against it are attacks on the freedom of the press. News Click’s only fault has been to practice journalism that covers people’s movements. The Delhi High Court vindicates our position. It also takes a strong stand in support of independent journalism in India.” The statement also said, “This reaffirms our faith in the courts. We thank all our erstwhile staff, associates and contributors, our readers, lawyers, our many friends and supporters and the very large number of journalists and fellow citizens who have expressed solidarity over the years.”
The EOW registered the FIR in August 2020 on a complaint forwarded by an undersecretary in the Ministry of Information and Broadcasting (I&B). The allegation was that NewsClick had received $ 1.5 million from an entry incorporated in the US state of Delaware at a supposedly overvalued share price.
The Myth of FDI Evasion
The allegation primarily rested on the claim that by pricing its shares at a premium, NewsClick was trying to get around the 26% FDI cap. A press note introduced the cap in September 2019, while the investment agreement has been signed in March 2018 and the $ 1.5 million was received in April 2018 – more than one year before the restriction existed. However, the NewsClick had also written to the I&B ministry in December 2017, before any investment was received, asking whether online news portals fell within the FDI restriction applicable to print media. The ministry replied in January 2018 that “online publications on website/web portal do not fall under the ambit of print media.” Which means, the state alleged an attempt to evade a yet-to-be-enacted law from a company that had preemptively sought government’s clarity on regulatory aspects.
NewsClick had obtained an independent valuation that set the fair value at Rs. 9,188. The agreed negotiated price is Rs. 11,510 per share. The court held that this was an ‘economic decision …. which does not spell out any criminal offence.’
Legitimate Valuations and Entity Verification
The government questioned the existence of the investing company, Worldwide Media Holdings LLC, saying that a company by that name had earlier been voided in Delaware. The court noted that the investor was a separate company incorporated later under the same name and also noted that the investigation had produced no material to prove that the entity was non-existent.
In the meanwhile, a New York Times report alleged in 2023 that there is a link between the news portal’s funding and Chinese state propaganda. Following this report the special Cell of Delhi police in October 2023 arrested Purkayastha under the Unlawful Activities (Prevention) Act (UAPA). In fact, within a week of the 2020 FIR, the ED registered an Enforcement Case Information Report (ECIR on the lines of FIR) and began money laundering proceedings under the Prevention of Money Laundering Act (PMLA) based on the same complaint forwarded by the I&B ministry. The FIR alleged criminal breach of trust, conspiracy and cheating.
Suppression of RBI Clearance
Purkayastha was in Tihar Jail for seven months before the Supreme Court declared his arrest void in May 2024 on the grounds that the written grounds of arrest had not been furnished to him or his counsel before the remand order was passed. An early status report, signed by an ACP of the EOW and emailed to NewsClick’s lawyers in July 2021. The report also said that the RBI had confirmed to the EOW that the FDI inflow to NewsClick was under an automatic route not requiring prior RBI approval. It was also clarified that there was no delay in share issuance and no violation of FEMA regulation.
When the EOW subsequently filed a fresh status report before the court, that reference was removed entirely, and no explanation was offered for it. The court observed that this correspondence was “sufficient to explain that there were no violations by petitioner”. The regulator whose domain the alleged offence fell within (the RBI) had cleared the transaction. The investigating agency had not disclosed this to the court. Now the HC decision is only regarding the case filed by the EOW and ED. The rest of the cases against Purkayastha and NewsClick have to be cleared. Even the judgement of the High Court is not final. The ED threatened to appeal against the Delhi HC judgment in Supreme Court.
UAPA Detention and Pre-Trial Punishment
This cavalier attitude of ED is disturbing. The frequency with which the ED and other agencies invoke special laws like UAPA and PMLA, shifting the burden of proof on the accused and significantly increase the threshold for the grant of bail. The HC also underlined the hollowness of the ED’s demand for more time to investigate over a year and half after it began its inquiries. The SC, to which the ED is going to appeal, observed last year in Robert Lalchungnunga Chongthu Vs State of Bihar, investigations cannot continue endlessly. The SC also repeatedly asserted, including in Purkayastha case, that bail should be the rule and jail should be an exception.
It can be said without any fear of contradiction that the process of establishing the guilt or innocence in itself is a punishment. It is more so in the cases filed under the draconian UAPA. Revolutionary poet Varavara Rao has been in custody for years along with many other human rights activists under UAPA for no fault of his. There is neither investigation nor trial. They are undergoing a sort of life term without being proven guilty of any crime. The apex court should review all the cases under UAPA.
Prominent Journalist
Dr. K. Ramachandra Murthy is a versatile journalist with a distinguished career. Dr. Murthy began his extensive career with Andhra Prabha of The Indian Express group in Bengaluru. He was editor of Udayam, Vaartha and Andhra Jyothy. Dr. Murthy founded and edited HMTV news channel and The Hans India, an English newspaper. He was also editorial director of the Telugu newspaper, Saakshi. He was awarded Ph. D for his research work in rural reporting. Dr. Murthy’s five decades in journalism showcases his influential roles across both print and electronic media. He wrote the political biography of NTR published by Harper Collins.
