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ED seizes Rs 5,551 crore from Chinese telecom firm Xiaomi in Bengaluru under FEMA

The Enforcement Directorate on Saturday seized Rs 5,551 crore from a Bengaluru-based Chinese Telecom Firm Xiaomi Technology India under the Foreign Exchange Management Act 1991.

The action has been taken against Xiaomi Technology India Private Limited. The company (also called Xiaomi India) is a trader and distributor of mobile phones in the country under the brand name MI.

Days after months-long investigations, the ED has seized the money from four bank accounts of the Chinese firm Xiaomi in connection with illegal outward remittances, the probe agency said.

Xiaomi is one of the top mobile phone brands in the country. It has an annual turnover of Rs 34,000 crore.

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The company started its operations in India in 2014 and the Company has remitted foreign currency equivalent to INR 5551.27 Crore to three foreign-based entities which include one Xiaomi group entity in the guise of Royalty, it said.

Such huge amounts in the name of Royalties were remitted on the instructions of their Chinese parent group entities. The amount remitted to other two US based unrelated entities were also for the ultimate benefit of the Xiaomi group entities, the probe agency said.

Without having any authorisation, Xiaomi remitted the money, it alleged. It violates the Section 4 of FEMA, the ED said.

The company allegedly also provided misleading information to the banks while remitting the money abroad.

ED sources told that the company had already sent a major portion of the money to its group companies in China.

The Chinese telecom company has been operating in India since 2014. As per the agreement, it procures the completely manufactured handsets from manufacturers in India, the ED said.

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The post ED seizes Rs 5,551 crore from Chinese Telecom Firm Xiaomi in Bengaluru under FEMA appeared first on APN News.



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ED seizes Rs 5,551 crore from Chinese telecom firm Xiaomi in Bengaluru under FEMA

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