Income Tax Department Virtually Frozen NewsClick Bank Accounts

NewsClick has been unable to make bank payments since Monday, i.e., December 18, in the evening, due to a Union Income Tax Department action, as stated in a statement on Tuesday.

The action, according to the online news outlet, “virtually frozen” its bank accounts, rendering it unable to pay staff and consultants for work done thus far in December.

The move was described as a “seeming continuation” of the government’s “administrative-legal siege” of the organisation, which began in 2021 and included the seizing of its contributors’ devices earlier this year. As reported by NewsClick, its employees face an unclear future.

“Coming at the end of the year, this unexpected action has left all of our employees stunned.” “Because there is no indication of when our accounts will be readily available, there is uncertainty in the minds of all employees and their families, particularly those who are totally dependent on NewsClick salaries,” it stated.

It also stated that it hadn’t violated any laws, including tax restrictions, in its statement. “The claims levelled by the income tax department are without any basis.”

Following an assessment of Monday’s developments, “legal appeals against this unfair and cruel measure will be initiated as soon as possible,” according to the statement.

Prabir Purkayastha, the portal’s founder, and Amit Chakraborty, its HR director, have been imprisoned since October 3 after being arrested by the Delhi police, an agency of the Union government, under the Unlawful Activities (Prevention) Act, a severe anti-terror law.

The devices of NewsClick personnel and contributors were also confiscated by the Delhi police‘s special squad.

Its complaint against Purkayastha and NewsClick alleges, among other things, that the portal utilised a “large amount” of Chinese funds to broadcast “paid news” criticising Indian government policies and promoting Chinese ones.

The FIR seems to have its origins in an August New York Times report, which BJP MP Nishikant Dubey referenced in the Lok Sabha to imply that Congress leaders and NewsClick had received cash from China to create an “anti-India” environment.

NewsClick has denied the accusations.

A day after the raids, NewsClick reported that government agencies like the income tax department had searched its offices and taken employees’ devices since 2021, but that the government had not been able to build a case against it.

Its whole December 19 statement is given below:

Due to an action by the Income Tax Department, NewsClick has been unable to make any bank payments as of the evening of December 18.

This step, which has effectively frozen our accounts, appears to be a continuation of the news portal’s administrative-legal siege, which began with ED raids in February 2021, was followed by an IT department survey in September 2021, and the October 3, 2023 crackdown by the Delhi Police Special Cell. Prabir Purkayastha, founder of NewsClick, and administrative officer Amit Chakraborty, who were arrested on that day, are still in jail.

NewsClick has always followed the rules of the land, including all tax restrictions. The claims made by the Income Tax Department are without foundation.

Furthermore, NewsClick had no notice of the bank account freezing, and the staff found it by mistake while attempting to make routine payments last evening. As a result of this rash decision, all employees  such as journalists, videographers, administrative and support personnel as well as consultants and contributors will not be paid, even for the 19 days they have already worked in December.

This unexpected action, which occurred during the year’s end festive season, has taken all of our staff by shock. Because there is no confirmation as to when our accounts will be available, all employees and their families are concerned, especially those who rely solely on NewsClick salaries.

NewsClick and its legal advisers are monitoring the situation. As a result, appeals against this unjustified and cruel measure will be filed as soon as possible.

NewsClick and its brave journalists are determined to keep working for as long as possible. As always, we ask for ongoing solidarity, which has provided us with support and encouragement.