Enforcement Directorate Imposes Heavy FEMA Penalty on NewsClick Portal
NEW DELHI: In a significant regulatory action, the Enforcement Directorate (ED) has imposed a substantial penalty of Rs 184 crore under the Foreign Exchange Management Act (FEMA) on the news portal NewsClick and its editor-in-chief, Prabir Purkayastha. Official sources confirmed this development to the ANI news agency on Monday, marking a major escalation in the ongoing scrutiny of the media organization.
Breakdown of the Financial Penalty
The detailed order from the ED specifies a penalty of Rs 120 crore on PPK NewsClick Studio Private Limited, the corporate entity that owns and operates the NewsClick portal. Simultaneously, editor-in-chief Prabir Purkayastha has been individually fined Rs 64 crore for his alleged role in the violations. The combined penalty underscores the agency's firm stance on the matter.
Primary Violations Identified by the ED
The enforcement agency has determined that the entities were "contravening" the provisions of FEMA on two critical counts. The first violation involved the misrepresentation of foreign direct investment (FDI) funds, while the second pertained to the misdeclaration of services and exports. These findings form the core basis for the hefty financial penalties imposed.
As of now, NewsClick's official response to this penalty order is still awaited. The organization has not publicly commented on the ED's latest action, leaving stakeholders and observers anticipating their next move.
Background of the Investigation and Previous Actions
This penalty follows a series of investigative steps taken by the ED. In September 2021, the agency conducted searches at the portal's premises located in the Saidulajab area of Delhi as part of a money laundering probe. During this extensive investigation, statements were recorded from more than 25 individuals, including Prabir Purkayastha himself, highlighting the depth of the scrutiny.
The year 2023 saw further developments when the ruling Bharatiya Janata Party (BJP) referenced a New York Times report to allege irregularities involving NewsClick and its promoters. The international report claimed that NewsClick was integrated into a global network receiving funding from American billionaire Neville Roy Singham, who is alleged to have close ties with the Chinese government media apparatus.
Police Raids and Expanded Scrutiny
Also in 2023, the Delhi Police's Special Cell executed raids at approximately 30 premises connected to NewsClick, including the residences of its journalists. In a coordinated effort, teams from the Delhi Police special cell and Mumbai Police conducted searches at the Juhu residence of activist Teesta Setalvad, broadening the scope of the investigation.
During these operations, police officials brought NewsClick editor Prabir Purkayastha, along with writers Paranjoy Guha Thakurta and Urmilesh, to the special cell offices in the national capital for questioning, indicating the seriousness with which authorities are treating the case.
About NewsClick and Its Founding Principles
Founded in 2009, NewsClick describes itself on its official website as an independent media organization dedicated to reporting news from India and around the world. The portal emphasizes a particular focus on covering progressive movements and social issues, positioning itself as a voice for alternative perspectives in the media landscape.
The imposition of this Rs 184 crore penalty represents one of the most significant financial penalties levied on a media entity under FEMA regulations in recent years, potentially setting a precedent for future enforcement actions in the sector.
