ED Imposes ₹184 Crore Penalty on NewsClick and Founder Prabir Purkayastha for FEMA Violations

The Enforcement Directorate (ED) on Monday imposed a penalty of ₹184 crore on news portal NewsClick and its founder Prabir Purkayastha for alleged violations of the Foreign Exchange Management Act (FEMA). Of the total, ₹120 crore has been levied on NewsClick and ₹64 crore on Purkayastha.

The ED said its adjudicating authority found that foreign direct investment (FDI) of ₹9.59 crore in FY 2018-19 was obtained by misrepresenting the company’s business activities, bypassing FEMA rules. Additionally, foreign inward remittances totaling ₹82.63 crore between FY 2018-19 and 2023-24 were misclassified and did not comply with mandatory reporting requirements, including SOFTEX forms, the agency stated.

“The transactions were deliberately structured to bypass the objectives of foreign exchange regulations. Prabir Purkayastha, as the company’s director, was held liable,” the ED said, adding that the violations were “substantial, deliberate, and systemic in nature.”

NewsClick and Purkayastha are under investigation by multiple agencies including the Central Bureau of Investigation (CBI), Delhi Police, and Income Tax Department for alleged anti-national activities, money laundering, and violations of the Foreign Contribution Regulation Act (FCRA). Purkayastha was arrested by Delhi Police in October 2023 and is currently out on bail.

The ED had also issued summons to Neville Roy Singham, an American entrepreneur based in Shanghai, in connection with the case, but received no response. Earlier reports, including a 2023 New York Times article, alleged that NewsClick was part of a global network funded by Singham that promoted Chinese government viewpoints—a claim the portal has denied.

NewsClick has maintained that all funding was routed through proper banking channels and reported to authorities, as confirmed in previous proceedings before the Delhi High Court.

Under FEMA 1999, the ED enforces foreign exchange regulations, with penalties imposed following adjudication of violations. The Reserve Bank of India (RBI) remains the sole regulator of foreign exchange in India.