The guidelines were seen by journalists as an attempt to control the media in an election year.
The statement issued by Guild president Raj Chengappa said, "The Editors Guild of India strongly condemns the arbitrary manner contemplated by the I&B ministry ostensibly to penalise any journalist or media organisation publishing fake news".
Such accreditation is required by journalists seeking to visit ministries and attend news conferences or government seminars.
Indian Prime Minister Narendra Modi on Tuesday reversed an order to punish journalists found guilty of reporting "fake news", after an outcry over a perceived government crackdown on the press.
This determination is expected to be completed within 15 days by these agencies, the ministry said.
The ministry did not define "fake news", but said it would refer complaints about it in print to the Press Council of India, with suspect cases on television going to the News Broadcasters Association. It added, "The accreditation shall be suspended for a period of six months in the first violation and for one year in the case of second violation, and in the event of third violation it would be canceled permanently".
The release had said that the regulatory agencies, while looking at the requests seeking accreditation, will examine if "Norms of Journalistic Conduct" and "Code of Ethics and Broadcasting Standards" prescribed by the PCI and National Basketball Association have been adhered to by journalists.
Fake news can only be registered by the PCI, but a complaint can be filed by an individual, the government or any other aggrieved person.
As for the cancellation or suspension of a journalist's accreditation, he said this can only be done if it's a gross case of fake news or in case of repeated violations. Instead, an announcement made it clear that all issues with respect to fake news would be dealt with the Press Council of India, the regulating agency for print media.
Within less than half an hour of those tweets, some journalists and media organisations broke the news about the withdrawal of the notification, on Twitter. Gupta tweeted: "Make no mistake: this is a breathtaking assault on mainstream media". It's a moment like Rajiv Gandhi's anti-defamation bill.
But critics have questioned the BJP's commitment to fighting fake news, pointing to several party members' defence of the recently arrested founder of PostCard News on charges including committing deliberate and malicious acts meant to outrage sentiments as evidence of this. Recalling the fight for press freedom during the 1975-77 Emergency, CPI (M) general secretary Sitaram Yechury said his party condemned the "duplicitous" move.
The system would also help with public funding for the media, he said.
While IPI appreciated Modis prompt intervention, it also noted that the security and safety of journalists in India remained under serious threat. "What is guarantee that these rules will not be misused to harass honest reporters?"