Ofcom has revoked the broadcast licence of Ausaf TV, a proposed Urdu channel, ahead of its UK launch.
The regulator's decision follows a BBC File on 4 investigation into the non-English broadcaster last October.
It comes after sister publication Daily Ausaf published praise of Jihadist leaders in its newspaper.
The paper's editor acknowledged there were breaches of editorial policy but said some material had been taken out of context.
Two of the world's most wanted terrorists, Masood Azhar and Hafiz Sayeed, featured in the publication.
The BBC programme also found praise of Osama Bin Laden and Mullan Omar, leader of the Afghan Taliban.
In an email to the BBC, the paper's senior editor, Muhammed Hanif Lodhi, reiterated the principles of the paper's editorial policy: peace, faith and unity - and said that the material File on 4 had highlighted was taken out of context.
He admitted there had been breaches of editorial policy in the articles being questioned by File on 4, which were printed earlier this year during a period when Mr Lodhi was absent from the office.
The BBC was told an internal investigation took place and The Daily Ausaf sacked two members of staff.
Mr Lodhi gave assurances that extra measures were now in place to ensure that such material would not appear in the future.
In one of the articles published in the newspaper, Bin Laden was described as "a humble servant of the Creator" who left "unforgettable prints on the history and geography of the world".
In another write-up, Bin Laden and Omar were called "beacons of light".
There was also praise for South Asian Jihadist leaders like Masood Azhar, who was described as a "renowned spiritual personality".
Syed Salahuddin, leader of Hizb-ul-Mujahideen, was described as someone with a "white glowing face, shining forehead, bright eyes, impressive personality" and that "you can't take your eyes off him".
In its decision announced on Thursday, Ofcom said the individual in control of Ausaf UK Limited had close links to the Pakistan and UK editions of the Daily Ausaf newspaper, in which articles were published.
Ofcom said that the content "amounted to hate speech and incitement to crime/terrorist actions".
"There is a material risk that the licensee could breach our broadcasting rules; for example, by airing similar content to that published in the Daily Ausaf on Ausaf TV, which would be harmful to viewers if the licensee were permitted to broadcast.
This brings into question public confidence in the regulatory activity if Ofcom were to remain satisfied that the licensee was fit and proper to broadcast", it said.
"In light of these serious findings, we are no longer satisfied that that those in control of Ausaf UK Limited are fit and proper to hold a broadcast licence. We have therefore revoked the licence", it concluded.