The Enforcement Directorate (ED) said on Thursday that Chinese smartphone maker Vivo illegally transferred Rs 62,476 crore to China in order to avoid paying taxes in India. The amount works out to around 50% of the company’s revenue during this period.
The agency has seized Rs 465 crore kept in 119 bank accounts by various entities linked to Vivo, Rs 73 lakh in hard cash and 2 kg gold bars. The ED had conducted raids on the premises of Vivo on Tuesday in a money laundering case.
The agency said on Thursday that three Chinese nationals, all of whom left India during 2018-21, and one other person from the country, incorporated as many as 23 companies in India in which they were also helped by a chartered accountant, Nitin Garg. Investigations have revealed that these companies were floated using fake documents. The addresses mentioned in the documents did not belong to them. In one case the address has turned out to be of an Indian government building.
Among the foreigners, one identified as Bin Lou was an ex-director of Vivo and according to the ED, he left India in April, 2018.
“These 23 companies are found to have transferred huge amounts of funds to Vivo India. Further, out of the total sale proceeds of Rs 1.25 lakh crore, Vivo India remitted Rs 62,476 crore or almost 50% of the turnover out of India, mainly to China,” an ED statement said.
Investigative agencies are also looking into the fact that some of these companies had disproportionate operations Jammu and Kashmir as well as Himachal Pradesh, both sensitive border states.
The ED said that while it followed ‘all due procedures as per law’ during the raids conducted under the criminal sections of the Prevention of Money Laundering Act (PMLA), it alleged ‘employees of Vivo India, including some Chinese nationals, did not cooperate with the search proceedings and tried to abscond, remove and hide digital devices which were retrieved by the search teams’.
Vivo has claimed that ‘as a responsible corporate, we are committed to be fully compliant with laws’.
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