Delhi HC issues notice to NewsClick's founder on police's plea against protection from arrest

The Delhi High Court on Tuesday issued a notice to Prabir Purkayastha, the founder and Editor-in-Chief of NewsClick, seeking his response to the police application directing the vacation of a previously granted interim protection order.

The protection was given to Purkayastha in a case involving alleged unlawful foreign funding, and was directed him to participate in the ongoing investigation.

Justice Saurabh Banerjee is presiding over the case.

The Delhi Police's application is part of the ongoing proceedings revolving around Purkayastha's request for anticipatory bail in connection with the matter. 

According to the Delhi Police, NewsClick allegedly received foreign funds that were used for broadcasting news within India, violating existing regulations. 

A probe conducted by the police reportedly uncovered instances of offences related to this funding.

The police counsel said that given the gravity of the situation, the granting of pre-arrest bail protection is unwarranted.

The police's contention is based on the assertion that NewsClick, in collaboration with entities abroad, executed a deceptive plan to secure and utilise funds, disguising them as Foreign Direct Investment (FDI).

The investigation remains ongoing, encompassing various aspects such as identifying the entities responsible for the origin of the funds and tracing the money trail to ascertain potential criminal and unlawful activities associated with the funding.

The Economic Offences Wing (EOW) of the Delhi Police filed an FIR alleging that PPK Newsclick Studio Pvt. Ltd, the company behind NewsClick, received FDI amounting to Rs 9.59 crore from M/s Worldwide Media Holdings LLC US during the financial year 2018-19. 

This investment was allegedly in violation of the law, as it is claimed that the company overvalued its shares to surpass the 26 per cent cap on FDI for digital news websites.

The FIR also alleges that a substantial portion of this investment was diverted for various payments, including salaries, consultancy fees, rent and other expenses. These transactions are believed to have been executed with ulterior motives.

As a result, the EOW claims that the company violated FDI laws and other statutes, leading to financial losses for the government.