I give zero sympathy or support to BJP and its destruction of India's democratic institutions.
Yet, I can't agree with your comment.
First, I don't think Razorpay supports BJP or its bigotry, at least openly.
One indicator of that is that they have retained critical media like AltNews and Wire as customers from years. I don't think they'd do that if they were pro-BJP or pro-bigotry.
Plus, I've noticed that rightwing companies and founders are generally very vocal about their support on social media (e.g.: PayTM, Zoho). They like boasting about their ideology. I don't see that with Razorpay or its founders. As far as I can see, Razorpay is "neutral".
Second, I don't see how YC can avoid funding such companies. You can't really expect them to include a rightwing checkbox that automatically excludes founders. YC itself seems to ignore ideology anyway. To repeat the previous point, there's nothing visibly political about Razorpay. It's not involved in any Indian government projects. It's not a Huawei or Palantir of India. I really don't see how YC can avoid funding such companies.
Third, the justice system that emerges from Indian laws, police training, and even its legal jurisprudence is anything but liberal. And that's ignoring the unethical malicious thinking that's prevalent in those people. We have sedition, UAPA, a quasi-blasphemy law, and a dozen other similar illiberal laws. Section 91 of the CrPC does seem to compel companies to hand over any information that's asked. I see this as an undesirable, but inevitable, outcome of our legal system. Whenever I donate, I do so knowing that I may come under government scrutiny some day.
Probably, Razorpay could have resisted the demand a little. But I doubt any neutral company does that. And even if they did, it wouldn't be for too long - some lower court would have forced them to disclose transactions.
A possible future outcome: The law and judiciary are increasingly turning into kangaroo courts. If Zubair or AltNews are declared terrorists under UAPA, all donors (who were just donating to upholding truth) can be labeled terror funders!