The Enforcement Directorate on Thursday alleged thatVivo India remitted nearly 50% of overseas sales proceeds, mainly to China, for disclosing huge losses in several domestically incorporated companies to evade payment of taxes in India.
“Vivo is cooperating with the authorities to provide all the necessary information. As a responsible corporate, we are committed to fully comply with the laws,” a Vivo India spokesperson had said earlier.
ED’s statement came after two days after the search In a case involving Grand Prospect International Communication Private Limited (GPICPL), which was allegedly being run by some Chinese nationals, at 48 locations across the country, including premises associated with Vivo India and its affiliated entities.
According to the agency, out of the total sales proceeds of ₹1,25,185 crore in the country, Vivo India had transferred ₹62,476 crore.
“During the said operations, due procedures in accordance with law were followed… Vivo India employees, including some Chinese nationals, did not cooperate in the search proceedings and attempted to avoid, remove and conceal the digital devices recovered by the search. teams,” the agency said.
It has so far seized 119 bank accounts of various entities with a gross balance of around ₹465 crore, including ₹66 crore in Vivo India fixed deposits, two kilograms of gold bars and ₹73 lakh in cash.
Vivo Mobiles India was incorporated in August 2014 as a subsidiary of Hong Kong based Multi Accord Limited in Delhi. In December 2014, GPICPL was incorporated by Chinese nationals, Zhengshen Ou, Bin Lu and Zhang Jie, allegedly with the help of chartered accountant Nitin Garg. It was registered with Shimla Registrar of Companies, with its offices at Solan and Jammu in Himachal Pradesh.
Mr. Lu left the country on April 26, 2018, while Mr. Ou and Mr. Ji went abroad last year. The ED said Mr Lu was also a former director of Vivo. He had reportedly set up 18 companies across the country just after he joined Vivo India in 2014-15. Another Chinese national, Zhixin Wei, incorporated four companies.
The suspected units were located in Delhi, Gurugram, Mumbai, Pune, Nagpur, Ahmedabad, Aurangabad, Hyderabad, Lucknow, Chennai, Bengaluru, Kochi, Jaipur, Kolkata, Indore, Guwahati, Patna, Raipur, Ranchi and Bhubaneswar. “These companies have transferred huge funds to Vivo India,” the agency said. Further investigation was going on.
The ED’s money laundering probe is based on a First Information Report (FIR) filed at Delhi’s Kalkaji police station on December 5, 2021, following a complaint from the Deputy Registrar of Companies (ROC), Delhi and Haryana.
It was alleged that some Chinese shareholders of GPICPL were posing as a subsidiary of Vivo and also used forged documents and false addresses in conspiracy with accused chartered accountants including Jagmohan Chodha and Ankita Uniyal. The agency found that the directors of GPICPL had disclosed the addresses which belonged to a government building and the house of a senior bureaucrat, as alleged.