Follow us on Google News
NEW DELHI — The Supreme Court has issued notice on an appeal filed by the Enforcement Directorate challenging a Delhi High Court judgment that quashed an Economic Offences Wing FIR and an associated money laundering case against digital media portal NewsClick and its founder-editor, Prabir Purkayastha. A three-judge bench led by Chief Justice of India Surya Kant, alongside Justice Vipul Pancholi and Justice R. Mahadevan, agreed to hear the central agency’s petition on November 6. The agency contended before the top court that the High Court overlooked critical evidence and prosecution submissions regarding foreign direct investment received by the portal, which the Enforcement Directorate claims was structured to bypass statutory foreign investment limits in digital news media.
ED Challenges Relief Granted Over Inflow of Foreign Capital
The controversy centres on approximately ₹9.59 crore, or nearly 1.5 million US dollars, received by NewsClick from the United States-based entity Worldwide Media Holdings LLC. Investigating agencies have alleged that the capital transfer was structured through inflated share valuations to evade overseas investment restrictions governing digital news media platforms. The central investigation agency further alleged that false declarations were made before banks and statutory regulators during the financial inflows, maintaining that the legal definition of cheating under penal law applies to deceiving state and statutory authorities alongside private individuals.
The matter had initially originated from FIR No. 116/2020, registered by the Delhi Police’s Economic Offences Wing in August 2020. Grounded on that primary complaint, the Enforcement Directorate subsequently registered a money laundering case under the Prevention of Money Laundering Act against M/s PPK NewsClick Studio Private Limited and Purkayastha. The agency’s petition before the Supreme Court argues that the Delhi High Court disregarded vital documentary material and legal contentions while evaluating the validity of the foreign capital received by the news organisation.
High Court Findings on Cheating and Criminal Breach of Trust
On May 29, 2026, Justice Neena Bansal Krishna of the Delhi High Court delivered a judgment on three connected petitions, quashing the Economic Offences Wing FIR and setting aside the dependent money laundering proceedings. The High Court observed that even if the prosecution claims were accepted at face value, the legal ingredients constituting the offence of cheating under Section 420 of the Indian Penal Code were absent. The bench pointed out that the overseas investor, Worldwide Media Holdings LLC, had never raised a formal grievance or claimed that it had been cheated or deceived into remitting the 1.5 million US dollar investment.
The High Court held that the penal offence of cheating requires an identified aggrieved party who has suffered wrongful deprivation of valuable property through fraudulent inducement, noting that no such complainant surfaced during the investigation. Furthermore, the court dismissed allegations of criminal breach of trust under Section 406 of the Indian Penal Code, observing that paying money to acquire company shares does not constitute legal entrustment of property, thereby precluding charges of misappropriation. The court also turned down the prosecution’s conspiracy argument, holding that normal commercial dealings do not establish criminal conspiracy without evidence of a shared illegal objective or unlawful means.
Earlier Bail Orders and the Impending Top Court Examination
Prior to the May 2026 quashing ruling, the Delhi High Court had granted Purkayastha anticipatory bail on July 23, 2025, across the two separate investigations registered by the Enforcement Directorate and the Economic Offences Wing. That protection followed an earlier interim order passed on July 7, 2021, which protected him from custodial arrest while directing him to participate in the ongoing probe.
The top court will now formally evaluate the legal validity of the High Court’s findings in the case titled Directorate of Enforcement vs M/s PPK NewsClick Studio Pvt. Ltd. The issuance of formal notice by the three-judge bench sets in motion appellate proceedings to examine the state agency’s grievances against the quashing order, leaving the final outcome of the prosecution dependent on upcoming hearings before the Supreme Court.
