Centre issues notices to three Chinese mobile firms for tax evasion

Finance Minister Nirmala Sitharaman informed Rajya Sabha that the government is looking into cases of alleged tax evasion by Chinese mobile companies Oppo, Vivo India and Xiaomi and notices have been given to them.

The Department of Revenue Intelligence (DRI) has issued a notice to Oppo for total customs duty of Rs 4,389 crore for misdeclaration of certain goods leading to a short payment in customs duty. It is said that the duty evasion is about Rs 2,981 crore. A show cause notice demanding Rs 4403.88 crore has been served on Oppo Mobiles India Ltd. based on the investigation.

Xiaomi has also been issued three show-cause notices. Five cases of Customs duty evasion have been booked against Xiaomi Technology India. The minister said, “The approximate duty liability there is about Rs 653 crore. For the three show cause notices, they have been issued, they have deposited only Rs 46 lakh.”

For Vivo India, a demand notice has been issued for Rs 2,217 crore for which they have deposited Rs 60 crore as a voluntary deposit. “Besides these, the ED is looking at 18 companies that were established by the same group Vivo and there they have voluntarily remitted Rs 62 crore as deposits but the parent company outside of India has total sales of 1.25 lakh crore. Of the Rs 1.25 lakh crore total sales, Vivo has transferred through these 18 companies huge amounts of funds and it is believed that Vivo India has, in turn, remitted 0.62 lakh crore to its parent company which is outside India,” the finance minister added.

The minister said, “During the period 2019 to 2022, in respect of the Central Board of Indirect Taxes & Customs (CBIC), cases against 43 other such companies have been booked. As regards to the Central Board of Direct Taxes (CBDT), Investigation Directorates have undertaken search & seizure actions in cases of five groups pertaining to the telecom sector, in which tax evasion has been detected.”