Vivo's offices caught with 2 kilo gold bars after sending ₹62,000 crore back to China – all you need to know on the ED probe
Vivohas allegedly transferred ₹62,476 crore to its parent company in China, in addition to being caught with 2 kilo gold bars in one of its offices.
- The Enforcement Directorate (ED) has claimed that Vivo remitted the amount to avoid paying taxes in India.
- The financial watchdog has blocked over a hundred bank accounts of the company.
AdvertisementChinese smartphone maker Vivo is currently in hot waters with the Enforcement Directorate (ED) in India after the financial watchdog accused the company and its associates in India of violating the Prevention of Money Laundering Act (PMLA).
The ED has conducted raids across 44 premises of Vivo and its associates in Uttar Pradesh, Bihar, Madhya Pradesh, Punjab, Haryana, and several other states across the country. The ED has accused Vivo of remitting nearly $8 billion to China.
Here’s everything that you need to know about the allegations against Vivo.
Vivo has reportedly sent ₹62,476 crore to China to evade taxes
According to a report by PTI, the ED has claimed that Vivo has remitted ₹62,476 crore, which is around 50% of its revenue over a five-year period to its parent company in China to avoid paying taxes.
"The agency is investigating why Vivo India declared profit as expenditure in its balance sheet and transferred substantial sums of money to China," an official familiar with the matter told Business Today.
The money laundering case against Vivo was filed by the agency after taking cognizance of an FIR filed by the Economic Offenses Wing of the Delhi Police against a Vivo distributor based in Jammu and Kashmir.
The report has claimed that Chinese shareholders of the company have used forged identity documents. The ED has claimed that the identity was forged to launder money using shell companies and “proceeds of the crime” have been sent to China and other businesses to bypass Indian rules.
Two directors flee the country
A report has also revealed that two Chinese directors of a company related to Vivo fled India after the ED raids. The directors were part of Solan, a Himachal Pradesh-based company that was associated with Vivo.
The agency has claimed that the Chinese nationals were made directors of the company using forged documents.
India blocks over a hundred accounts linked to Vivo
As part of its investigation into money laundering violations, the ED has reportedly blocked 119 bank accounts linked to Vivo. The accounts reportedly have over ₹465 crore. The agency has also seized ₹73 lakh in cash and 2kg gold.
China calls for a “fair and non-discriminatory business environment”
AdvertisementAfter the ED raided Vivo and its associates, a spokesperson from the Chinese embassy called for a “fair and non-discriminatory business environment” for Chinese firms in the country.
"The Chinese government has always asked Chinese companies to comply with local laws and regulations in their overseas operations and will firmly support Chinese companies to maintain their legitimate rights and interests," Wang Xiaojian counselor and spokesperson, Chinese Embassy in India said in a statement.
"The Indian side should act in line with laws and regulations and provide a fair and non-discriminatory business environment for Chinese firms," Xiaojian added.
India hits back, says Vivo needs to follow the law of the land
The Indian side has also hit back after the Chinese spokesperson called upon India to provide a non-discriminatory business environment.
"Companies that operate here need to follow the law of the land. Our legal authorities are taking steps as per the law of the land. I don't see the case to make comments as such on it," Arindam Bagchi, spokesperson, ministry of external affairs said in a media briefing.
Chinese smartphone maker Huawei comes under the IT department’s scanner over tax evasion
EXCLUSIVE: 84% of the ₹5,551.27 crore of the alleged illegal remittance by Xiaomi India were to the Qualcomm Group
Vivo reportedly transferred nearly $8 billion to its parent company in China
Popular on BI
- Jhulan Goswami’s two decade-long career is ‘monumental’, says BCCI on her retirement
- Chandigarh airport to be named after Bhagat Singh: PM Modi
- RBI set for fourth straight rate hike to quell inflation, say experts
- No peace overtures expected between India and Pakistan
- Space dedicated to food and beverage companies in malls on the rise post pandemic