Directorate of Revenue Intelligence Searches Oppo India Offices For Alleged Customs Duty Evasion of Rs 4389 Crore
After Vivo, Oppo is now under the radar of Directorate of Revenue Intelligence (DRI) regarding the alleged money laundering and tax evasion.
Evasion of ?4389 Crore
The mobile company Oppo India was rummaged through by the Directorate of Revenue Intelligence (DRI) and they have unearthed customs duty evasion of nearly ?4389 core by the company.
While DRI carried out the investigation at the office premises of Oppo India as well as at the residences of its key management employees, incriminating evidence indicating wilful mis-declaration in the description of certain items imported by Oppo India was recovered. These items were claimed to be used in the manufacturing of mobile phones.
Wrongful Availment of Crores of Rupees
According to the PIB release, due to this misdeclaration, the wrongful availment of ineligible duty exemption benefits by Oppo India amounting to ?2,981 crore was done. In the PIB release, it is mentioned that when the senior management employees and domestic suppliers of Oppo India were questioned, they accepted the submission of wrongful description before the Customs Authorities at the time of import.
Notably, it has also been revealed in the investigation that in lieu of use of proprietary technology/brand/IPR license etc. Oppo India had remitted / made provisions for payment of ‘Royalty’ and ‘Licence Fee’ to various multinational companies, including those based in China.
In violation of Section 14 of the Customs Act, 1962, read with Rule 10 of the Customs Valuation (Determination of Value of Imported Goods) Rules 2007, the said ‘Royalty’ and ‘Licence Fees’ paid by Oppo India were not being added in the transaction value of the goods imported by them. The alleged duty evasion by M/s Oppo India on this account is ?1,408 crore.
Dealing in in various brands of mobile phones, including Oppo, OnePlus and Realme, Oppo India is engaged in the business of manufacturing, assembling, wholesale trading, distribution of mobile handsets and accessories thereof, across India.
A lawyer for the company told that earlier the Enforcement Directorate had frozen Vivo India’s accounts over alleged money laundering, but now the court has lifted the freeze and ordered the Chinese company to provide a bank guarantee of $119 million.
According to the ED, Vivo India’s nearly 23 associated firms such as Grand Prospect International Communication Pvt Ltd (GPICPL) had transferred huge amounts to the firm and out of the total sale proceeds of ?1,25,185 crores, it remitted ?62,476 crores almost 50 per cent of the turnover out of India, mainly to China.