New Delhi, July 7: Rs 62,476 crore has been “illegally” transferred to China by smartphone maker Vivo to evade payment of taxes in India, the Enforcement Directorate said on Thursday, as it busted a major money laundering racket. claimed to have done. In which Chinese citizens and many Indian companies are included. This money is almost half of Vivo’s Rs 1,25,185 crore business, it said without specifying the time period of the transaction.
The crackdown on the major Chinese company came after the Federal Investigation Agency found that three Chinese nationals, all of whom “left” India During 2018-21, and another person from that country incorporated 23 companies in India, also assisted by a chartered accountant, Nitin Garg.
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Among the foreigners, one identified as Bin Lu was a former Vivo director and according to the ED, he left India in April 2018. Two others – Zhengshen Ou and Zhang Jie – left the country in 2021, it said.
“These (23) companies have transferred funds to Vivo India in large amounts. Also, out of the total sales proceeds of Rs 1,25,185 crore, Vivo India remitted Rs 62,476 crore or nearly 50 per cent of the turnover. India, Mainly for China,” the ED said in a statement.
The remittance, it added, was made “to disclose huge losses in Indian incorporated companies to evade payment of taxes in India”. The crackdown is being seen as part of the central government’s crackdown on Chinese entities and continued crackdown on such firms and their associated Indian operatives who allegedly indulged in serious financial crimes such as money laundering and tax evasion while working here. Huh.
The action to take action against Chinese-backed companies or entities operating in India comes in the backdrop of the military standoff between the two countries along the Line of Actual Control (LAC) in eastern Ladakh, which has been going on for more than two years. year now. The statement came after the ED raided 48 locations of Vivo Mobiles India Pvt Ltd. Ltd. and its associated companies across the country on July 5.
Vivo had said on Tuesday that “as a responsible corporate, we are fully committed to complying with the laws.” Followed all due procedures in accordance with law”, but alleged that “vivo India employees, including some Chinese nationals, did not cooperate. Search proceedings were conducted and the digital devices recovered by the search teams were absconded, removed and hidden.” Tried.”
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Recently, Indian intelligence agencies found that data from domestic customers was being “illegally” transferred by Chinese companies to servers maintained in that country. The ED also said that after the raids, it seized Rs 465 crore of money, Rs 73 lakh in cash and 2 kg of gold bars held in 119 bank accounts by various entities involved in the case.
The agency, after perusing a Delhi Police FIR (registered at Kalkaji police station) of December last year, filed an Enforcement Case Information Report (ECIR), an ED equivalent to a police FIR, of Grand Prospect International, an affiliated company of Vivo. Against, Grand Prospect International Communication Private Limited (GPICPL), its directors, shareholders and certain other professionals.
The police complaint was filed by the Ministry of Corporate Affairs alleging that GPICPL and its shareholders had used “forged” identity documents and “false” addresses at the time of incorporation of the company in December, 2014.
The registered address of this company was at Solan (Himachal Pradesh), Gandhinagar (Gujarat) and Jammu (J&K). The three Chinese nationals mentioned above incorporated this company, while the fourth one, Zhixin Wei, also opened four companies to conduct similar transactions. “The allegations (made by the ministry) were found to be true as investigation revealed that the addresses mentioned by the directors of GPICPL were not theirs, but in fact it was a government building and the house of a senior bureaucrat.” ED said.
It said that Vivo Mobiles Pvt Ltd was incorporated on 1 August 2014 as a subsidiary of Hong Kong based company Multi Accord Ltd. The ED has identified other 22 companies as follows: Rui Chuang Technologies Pvt Ltd (Ahmedabad), We Dream technology & Communication Private Limited (Hyderabad), Regenvo Mobile Private Limited (Lucknow), Fengso technology Pvt Ltd (Chennai), Vivo Communication Pvt Ltd (Bangalore), Bubugao Communication Pvt Ltd (Jaipur), Haicheng Mobile (India) Pvt Ltd (Delhi), Joinme Mumbai Electronics Pvt. Ltd. (Mumbai), Yingjia Communication Pvt. Ltd. (Kolkata) and Ji Lian Mobile India Pvt. Ltd. (Indore).
The rest are Vigor Mobile India Pvt Ltd (Gurugram), Hisoa Electronic Pvt Ltd (Pune), Haijin Trade India Pvt Ltd (Kochi), Rongsheng Mobile India Pvt Ltd (Guwahati), Morfun Communication Pvt Ltd (Patna), Ahua Mobile India Pvt. Ltd (Raipur), Pioneer Mobile Pvt Ltd (Bhubaneswar), Unime Electronic Pvt Ltd (Nagpur), Junwei Electronic Pvt Ltd (Aurangabad), Huijin Electronic India Pvt Ltd (Ranchi), MGM Sales Pvt Ltd (Dehradun) and Joinme Electronic Pvt Ltd (Mumbai).
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