New Delhi, February 16 The Enforcement Directorate (ED) said on Monday that it has imposed a ₹184 crore penalty under the FEMA against the news portal NewsClick and its founder and editor-in-chief, Prabir Purkayastha, who came under the scrutiny of the investigating agencies on allegations of disseminating "pro-China propaganda" through its articles.
PPK NEWSCLICK Studio Private Limited, the company that owns NewsClick, has been penalized with a sum of ₹120 crore, while Purkayastha has been imposed with a similar order of ₹64 crore under the Foreign Exchange Management Act (FEMA), the federal agency said in a statement.
The order was issued by the Adjudicating Authority of FEMA (a director-level officer of the ED) after completing the adjudication process (the end of the investigation) against the two entities related to "violations" of foreign direct investment (FDI) and foreign inward remittances.
"The Adjudicating Authority observed that the violations were substantial, deliberate, and systemic in nature, involving large-scale foreign exchange transactions and a breach of statutory declarations furnished to regulatory authorities," it said.
There was no immediate response from NewsClick on the development.
The agency said the penalty was imposed after the ED conducted a detailed examination of records, evidence, and submissions made by the noticees (PPK NEWSCLICK Studio and Purkayastha).
The ED has a separate money laundering case registered against the portal, and had first raided the premises of NewsClick located in the Saidulajab area of the national capital in September 2021. It also filed a FEMA case against it.
The agency has recorded the statements of more than 25 people in the money laundering case, including that of Purkayastha. The Delhi Police has also investigated these entities.
The BJP, in 2023, had quoted a New York Times news article to allege that the portal and its promoter were "promoting a pro-China agenda" through its articles.
The news article stated that the portal was part of a global network that received funding from American billionaire Neville Roy Singham, who allegedly works closely with the Chinese government media machine.
The ED said its investigation found that FDI of ₹9.59 crore was received (by the company) during the 2018-19 fiscal by "misrepresenting" the nature of business activity in statutory filings, thereby bypassing prescribed sectoral conditions and entry route requirements under FEMA.
It was also detected that foreign inward remittances of ₹82.63 crore, purportedly received between 2018-19 and 2023-24 financial years, for export of services, were found to be in "contravention" of FEMA provisions due to "misclassification" of exports and "failure" to comply with mandatory reporting requirements, including submission of SOFTEX (used for software or information technology exports) forms.
"The transactions were deliberately structured in a manner that defeated the objectives of the foreign exchange regulatory framework," the ED said.
It added that as Purkayashta, the director of the company, was found to be in charge of and responsible for the conduct of business at the relevant time and, therefore, he was held liable under section 42 of FEMA (contravention by companies).
The portal, founded in 2009, states on its website that it is an independent media organisation dedicated to covering news from India and elsewhere with a focus on progressive movements.
