Supreme Court Issues Notice To Prabir Purkayastha & NewsClick On ED’s Plea Against Order Quashing Money Laundering Case

The Supreme Court issued notice on a Special Leave Petition filed by the Directorate of Enforcement (ED) challenging the Delhi High Court judgment that quashed the ECIR registered against PPK Newsclick Studio Pvt. Ltd. and its promoter-director, Prabir Purkayastha, under the Prevention of Money Laundering Act, 2002 (PMLA).

The High Court on May 29, 2026 quashed the First Information Report (FIR) and the Enforcement Case Information Report (ECIR), ruling that no offence under Sections 406, 420 or 120B of the Indian Penal Code was made out.

The Bench of Chief Justice Surya Kant, Justice Joymalya Bagchi and Justice V Mohana issued notice and granted the time sought to file replies.

The Bench also remarked, "Not very impressed with the ED SLP itself."

During the hearing, counsel appearing on behalf of Additional Solicitor General S.V. Raju, for the ED, submitted that the High Court had quashed the FIR registered by the Economic Offences Wing (EOW) of the Delhi Police and, as a consequence, the ECIR as well.

It was submitted that while the ED had approached the Court against the quashing of the ECIR, the Delhi Police was in the process of filing its own challenge to the quashing of the FIR.

The FIR was registered under Sections 406, 420 and 120B of the Indian Penal Code on a complaint forwarded by the Ministry of Information and Broadcasting. It alleged that the digital news portal had received foreign direct investment of about Rs 9.59 crore from Worldwide Media Holdings LLC, a Delaware-based entity, in exchange for shares issued at a premium of Rs 11,510 per share against a face value of Rs 10.

The EOW alleged that the premium was charged to circumvent the 26 per cent FDI cap and to avoid government approval for investment in digital news media. It further alleged that more than 45 per cent of the FDI was siphoned off towards salaries, consultancy fees and rent, and that the investor company had been incorporated in Delaware before the investment was made. The ED registered an ECIR on the basis of the FIR and carried out search and seizure operations at the premises of the company and its associates.

Allowing the petitions, the High Court held that even if all allegations in the FIR were taken at face value, no offence under Section 420 or 406 IPC was made out. It observed that there was no aggrieved person who had been cheated or who had entrusted property, and that the investor had made no complaint, the complainant being a mere informant.

It held that the issuance of shares at a premium was a commercial decision, that the valuation conformed to FEMA norms, and that allegations of excessive salary and rent payments disclosed no criminal offence. As regards criminal conspiracy, the Court found that the ED had failed to show any illegal object or illegal means, and that nothing incriminating had emerged despite prolonged investigation. It observed that the continuation of the FIR amounted to a gross abuse of the process of law.

Cause Title: Directorate of Enforcement v. M/s PPK NewsClick Studio Pvt. Ltd. & Ors. [Diary No. 63217/2026]