PTI08 01 2022 000237B

Offer notifications sent to Oppo, Vivo and Xiaomi for tax evasion

Nirmala Sitharaman says the government is also looking into fraud via digital loan apps

Nirmala Sitharaman says the government is also looking into fraud via digital loan apps

Finance Minister Nirmala Sitharaman on Tuesday informed the Rajya Sabha that three mobile operators – Oppo India and Xiaomi Technology India Pvt. Ltd., and Vivo Mobiles India – under investigation for evading service and diverting sales proceeds to companies outside India. All three companies are from China.

Ms Sittraman said the government is aware of cases where digital loan applications “originating from a specific country” are being misused to harass citizens and extort money. “The government is consciously taking action against the Indian nationals who helped set up these and other shell companies through which they operate,” she added.

In response to a question from Member Sushil Modi, about Chinese companies that have transferred funds to China and territory controlled by China, the Minister said the Directorate of Revenue Intelligence (DRI) had issued a notice to Oppo for Rs 4,389 crore evading duty on the basis of false advertisement for some merchandise. “Dust evasion is around Rs 2,981 crore, which is less than the value of imported goods of Rs 1,408 crore. Oppo has voluntarily deposited Rs 450 crore for an order of Rs 4,389 crore.”

Three notices of the reason for the offer have been made to Xiaomi, whose approximate liability is Rs 653 crore. “For the three offer notices, they have deposited only Rs 46 crore,” the minister said, adding that “the third company is Vivo India and an order notice of Rs 2,217 crore has been made for which they have deposited Rs 60 crore.”

Besides this, the Execution Department (ED) is studying 18 companies created by Vivo, it said. While the company has voluntarily transferred ₹62 crore as deposit, Vivo India is believed to have transferred ₹0.62 crore to its parent company outside India, through these 18 companies, for total sales of Rs.1.25 thousand crore which occurred between July 2017 and March 2021, the Minister explained in a written response.

It added that five cases of customs evasion have been registered against Xiaomi Technology India.

During the period from 2019 to 2022, the Central Board of Indirect Taxes and Customs (CBIC) registered cases against another 43 such companies. With regard to the Central Council for Direct Taxes (CBDT), the detective directorates have carried out search and seizure procedures in the cases of five groups related to the telecommunications sector, due to tax evasion.

Ms Sitharaman, in response to a question from Prime Minister Narendra Modi about the number of 43 Chinese companies under the CBIC lens, said that all the companies belong to different countries.

Meanwhile, the Ministry of Home Affairs (MHA) informed Lok Sabha on Tuesday that 81 Chinese nationals were given a “Notice to Leave India” in 2019, 2020 and 2021. While as many as 117 Chinese have been deported, another 726 have been placed in detention. On the opposite list for violation of visa conditions or other illegal acts.