The Enforcement Directorate conducted raids at 44 locations nationwide on Tuesday, that were connected to the Chinese cellphone operator Vivo. The searches are being done as part of a probe into money-laundering at the Chinese smartphone manufacturer.
Bihar, Jharkhand, Uttar Pradesh, Himachal Pradesh, Madhya Pradesh, Punjab, and Haryana are some of the states where searches are ongoing. The searches are being conducted under clauses of Prevention of Money Laundering act.
Vivo Mobile Communications Co. and ZTE Corp.’s Indian subsidiaries were investigated in May for alleged financial irregularities. ZTE Corp. is a Chinese technology company that is partially owned by the Chinese government.
Other than Vivo, the finance Ministry sent three show-cause letters to Xiaomi Technology India, a subsidiary of Chinese phone manufacturer Xiaomi, in January of this year for undervaluing goods in order to avoid paying customs duties. The tax authorities are requesting the corporation to pay Rs 653 crore in taxes in addition to the notices. The Directorate of Revenue Intelligence (DRI) launched a thorough inquiry into Xiaomi India and its contract manufacturers prior to this development.
After conducting nationwide searches on top Chinese cell firms on December 21, the Income Tax Department made this development one month later. The Oppo, Xiaomi, and One Plus offices in Delhi as well as those in 11 other states, including Karnataka, Tamil Nadu, Assam, West Bengal, and the states of Gujarat, Maharashtra, Andhra Pradesh, and Bihar and Rajasthan, were searched.
The search turned up two significant corporations that had sent over Rs 5500 crore in remittances to and on behalf of their group entities abroad under the guise of royalties.
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