The government is looking into cases of alleged tax evasion by three mobile companies of China including Oppo, Vivo India and Xiaomi, and notices have been given to them, Finance Minister Nirmala Sitharaman informed Rajya Sabha on Tuesday during the Question Hour.
“Investigation by the Enforcement Directorate revealed that Vivo Mobiles India Pvt Ltd has remitted an amount of ₹0.62-lakh crore mainly to China and its controlled territories, of their total sales of ₹1.25-lakh crore during the period July 2017 to March 2021 which works out to 49.91 per cent,” she said responding to questions by Sushil Kumar Modi.
A show-cause notice, inter-alia, demanding ₹4,403.88 crore has been served on Oppo Mobiles India based on the investigation conducted by the Directorate of Revenue Intelligence (DRI), she said adding that five cases of customs duty evasion have been also booked against Xiaomi Technology India.
During 2019-22, in respect of Central Board of Indirect Taxes & Customs (CBIC), cases against 43 other such companies have been booked. As regards to Central Board of Direct Taxes (CBDT), Investigation Directorates have undertaken search and seizure actions in cases of five groups pertaining to the telecom sector, in which tax evasion has been detected.
The DRI has issued a notice to mobile company Oppo for total customs duty of ₹4,389 crore and these are on the grounds of mis-declaration of certain goods leading to a short payment in customs duty, she said, adding, “duty evasion we think is about ₹2,981 crore”.
“Undervaluation of imported goods for the purpose of payment of customs duty, that we think is an evasion of ₹1,408 crore,” the Finance Minister said. She also mentioned that voluntarily they have come about to deposit ₹450 crore, much against the demand of ₹4,389 crore.
Sitharaman said Xiaomi is another mobile company which deals with assembled MI mobile phones. “Three show-cause notices have been issued to them and the approximate duty liability there is about ₹653 crore. For the three show-cause notices, they have been issued, they have deposited only ₹46 lakh.”
The third company is Vivo India, for whom also there is a demand notice issued for ₹2,217 crore for which they have deposited ₹60 crore as voluntary deposit, she informed the House.