Enforcement Directorate seized Xiaomi’s asset worth ₹5,551.27 crore indiabusinessport.com

Enforcement Directorate seized RS 5,551.27 crore from Xiaomi Technology Private Limited lying in its bank accounts. The seizure order issued by the Enforcement Directorate against Xiaomi Technology India Private Limited for 5,551.27 crore was confirmed on Friday by the authority designated under Section 37A of the Foreign Exchange Management Act (FEMA).

ED in a press release said, “The Competent Authority appointed under Section 37A of the Foreign Exchange Management Act has confirmed the seizure order of Rs. 5551.27 Crore dated 29.04.2022 passed by the Directorate of Enforcement (ED) against Xiaomi Technology India Private Limited under the provisions of FEMA”

It added”The Authority while confirming the seizure of Rs. 5551.27 Crore, held that ED is right in holding foreign exchange equivalent to INR 5551.27 Crore has been transferred out of India by the Xiaomi India in an unauthorised manner and is held outside India on behalf of the group entity is in contravention of Section 4 of the Foreign Exchange Management Act, 1999 and the same is liable to be seized in terms of provisions of Section 37A of the FEMA”

It also observed royalty was being used as a tool to transfer money outside of India which constituted a violation of Section 4 of the FEMA while accusing the company of remitting the said amount abroad in the guise of royalty.

This is also the highest ever amount of seize order issued by the authority to date.

ED also accused Xiaomi of sending foreign remittances since 2015 to three entities in the name of royalty with the total amount sent to date amounting to 5551.27 crore.

It said, “The Company started its operations in India in the year 2014 and started remitting the money from the year 2015. The Company has remitted foreign currency equivalent to INR 5551.27”

Xiaomi India had approached the Karnataka High Court in July this year against the raids and seizure by ED, but the high court had directed it to first approach the competent authority.

The Chief customs official, Chennai was appointed as the competent authority in this case.

Catch all the Corporate news and Updates on Live Mint.
Download The Mint News App to get Daily Market Updates & Live Business News.


Subscribe to Mint Newsletters

* Enter a valid email

* Thank you for subscribing to our newsletter.

Source link

Leave a Comment

Your email address will not be published. Required fields are marked *

%d bloggers like this: