Delhi High Court Quashes Police and ED Cases Against NewsClick, Calling Them 'Gross Abuse of Process'

Justice Neena Bansal Krishna of the Delhi High Court delivered a judgment on May 29 quashing the FIR registered by the Delhi Police's Economic Offences Wing (EOW) in August 2020 and the Enforcement Directorate's Enforcement Case Information Report (ECIR) filed under the Prevention of Money Laundering Act in September 2020 against NewsClick and its editor-in-chief Prabir Purkayastha. The court found that even accepting all allegations at face value, the essential ingredients of cheating under Section 420 IPC and criminal breach of trust under Section 406 IPC were not established, noting that the investor Worldwide Media Holdings LLC had filed no complaint of being cheated and that the original complaint was made by a mere informant. On the FDI overvaluation allegation, the court pointed to a January 2018 Ministry of Information and Broadcasting clarification confirming there was no 26% FDI cap on digital news media at the time of the investment, and found that shares were independently valued and priced through legitimate negotiation. The court dismissed the fund diversion allegation — that over 45% of the investment went to salaries, rent, and consultancy fees — as normal operating expenditure for a digital media company. It also rejected the ED's attempt to sustain its case on criminal conspiracy grounds, finding no evidence of an illegal objective or criminal means, and noted that despite over a year and a half of investigation and repeated summons of staff, no incriminating material had been placed on record. The court described the proceedings as 'mala fide' and an 'arbitrary attack' on free and impartial journalism. The Enforcement Directorate and EOW have indicated they will appeal the ruling, with ED sources contending the court exceeded its jurisdiction at the quashing stage by assessing whether allegations were conclusively proved rather than merely prima facie made out.