The Delhi High Court on Friday sought the stand of news portal NewsClick and its editor-in-chief on a plea by the Enforcement Directorate (ED) seeking vacation of an earlier order granting them protection from coercive action in a money laundering case.
Issuing a notice to NewsClick and its editor-in-chief Prabir Purkayastha, Justice Saurabh Banerjee observed that prima facie, the investigation agency's submissions for vacation of interim protection have merit and require deliberation.
The application is part of the ongoing proceedings on a petition by the portal seeking a copy of the Enforcement Case Information Report (ECIR) lodged by the ED in the case.
The ED counsel said new material has been unearthed, revealing the commission of offence of money laundering.
He also said the petition was not maintainable as the ECIR is an internal document that cannot be supplied and the petitioners cannot "piggyback" on the interim relief.
This is a criminal conspiracy for "paid news" where crores of rupees have come in violation of laws, the ED's counsel submitted.
"Prima facie, in the opinion of this court, the above contention has merit and requires deliberation. In view thereof, issue notice," Justice Banerjee said and listed the matter for further hearing on September 6.
Counsel for the petitioners said there was no urgency in the matter.
In the application for vacation of the interim order, the ED said the Supreme Court has deprecated the practice of "blanket no coercive action" orders and such orders during the course of investigation virtually amount to granting anticipatory bail to the accused.
"Since ECIR can no longer be provided to the accused and as for grant of anticipatory bail the twin conditions of Section 45 (PMLA) are required to be complied (with), the continuation of interim protection to the accused petitioner virtually amounts to grant of anticipatory bail in a PMLA case without satisfaction of the twin conditions. Therefore, the orders dated 21.06.2021 and 29.07.2021 granting interim protection must be vacated at the earliest in view of the settled position of law," the ED application said.
On June 21, 2021, the High Court had directed the ED not to take any coercive action against NewsClick and Purkayastha in connection with the money laundering case. The interim protection was further extended on July 29, 2021.
The ED initiated its probe on the basis of a Delhi Police FIR and has conducted searches on the premises of NewsClick and several other places in connection with the money received from overseas.
According to the FIR, the petitioner company, PPK Newsclick Studio Private Limited, received foreign direct investment (FDI) to the tune of Rs 9.59 crore from Worldwide Media Holdings LLC USA during 2018-19.
It alleged that the investment was made by greatly overvaluing the shares of the petitioner company to avoid the 26 per cent FDI cap in a digital news website.
It was further alleged that over 45 per cent of this investment was diverted or siphoned off for the payment of salary/consultancy, rent and other expenses.
Therefore, it is alleged that the company has violated FDI and other laws of the country and caused a loss to the government exchequer.
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