FIR for alleged violation of foreign funding laws bid to create chilling effect: NewsClick in HC
The HC was hearing the 2021 plea by the petitioner company, M/s PPK NewsClick Studio Private Limited, which owns the digital portal, seeking quashing of an FIR registered by the Delhi Police's Economic Offences Wing (EOW), as part of a batch of pleas pertaining to investigations by EOW and the Enforcement Directorate (ED) against the company.
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NewsClick founder Prabir Purkayastha (L) and HR Head Amit Chakravarty being brought to the Lodhi Road Special Cell office in New Delhi. (File) Online news portal NewsClick argued before the Delhi High Court Wednesday that the registration of an FIR for alleged violation of foreign funding laws was an attempt to “target it” and create a “chilling effect”.
The HC was hearing the 2021 plea by the petitioner company, M/s PPK NewsClick Studio Private Limited, which owns the digital portal, seeking quashing of an FIR registered by the Delhi Police’s Economic Offences Wing (EOW), as part of a batch of pleas pertaining to investigations by EOW and the Enforcement Directorate (ED) against the company.
The EOW’s FIR was registered on August 26, 2020, under IPC sections 406 (punishment for criminal breach of trust), 420 (cheating and dishonestly inducing delivery of property), and 120B (punishment of criminal conspiracy). It alleged that the petitioner company had received foreign direct investment of Rs 9.59 crore from M/sWorldwide Media Holdings LLC, USA, during the financial year 2018-19 which was made by “greatly overvaluing the shares of the company to avoid the alleged cap of 26% FDI in a digital news website”.
Among the various contentions raised, senior advocate Siddharth Agarwal submitted before a single-judge bench of Justice Saurabh Banerjee that the court may have to consider if there had been an abuse of process of law by investigating and prosecuting agencies.
He said the registration of the FIR and the investigation of the petitioner company was an attempt to “target the petitioner and silence its independent and impartial reporting of various issues of national importance”.
He further said, “Such proceedings are intended to create a chilling effect on various persons including journalists, discouraging them from exercising their constitutional right.
He added, “I’m today unfortunately not liked by somebody. Which is the reason why for a case which does not stand to reason, logic…I’m being prosecuted. So there is something special about me.”
Among various things, the FIR alleged that the petitioner company had violated “FDI and other laws of the country and caused a loss to the exchequer”. The FIR also alleged that over 45% of investment was diverted/siphoned off for payment of salary/consultancy, rent and other expenses. These payments are alleged to have been made for ulterior motives, as per the EOW.
On Tuesday, senior advocate Kapil Sibal, appearing for the petitioner, had raised questions over the alleged loss to the government exchequer. He had argued that a case under Sections 420 and 406 (IPC) was not made out, adding that this was “nothing but pure malafide”.
On October 13, the HC had dismissed pleas moved by editor-in-chief of NewsClick Prabir Purkayatha and HR head Amit Chakravarty challenging their arrest and remand in a separate Unlawful Activities (Prevention) Act case. The two were arrested last month following allegations that the news portal received money for pro-China propaganda.
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