Pressure mounted on the Chinese telecom infrastructure major Huawei as Income Tax (IT) department raids at the company continued for the second day on Wednesday and senior officials were grilled by the sleuths.
Sources said that documents related to financial transactions at the company have been seized, as the noose tightens around its operations in India.
The raids were underway at its offices in Bengaluru, Delhi and Gurugram, as per the sources.
IT officials looked at financial documents, account books and company records as part of a tax evasion investigation against the company, its Indian businesses and overseas transactions. Some records have been seized too, the sources added.
When asked, Huawei, the company, said, "We have been informed of the visit of Income Tax team to our office and also of their meeting with some personnel. Huawei is confident our operations in India are firmly compliant to all laws and regulations."
"We will approach related government departments for more information and fully cooperate as per the rules and regulations and follow the right procedure," it added.
Huawei is the second Chinese telecom firm where IT raids are being conducted, months after similar raids at ZTE offices. The government had said that it unearthed a variety of infringements, including multi tax evasions, bogus expenses worth crores of rupees and illegal share purchases.
The two Chinese firms (Huawei and ZTE) in telecom equipment space have been providing infrastructure support to most of the telecom service providers (TSPs) including Bharti Airtel and Vodafone Idea, and still are part of ongoing contracts in 4G telecom services, under their old contracts.
However, over the last two years, both the Chinese firms have been denied trials for the upcoming 5G network, sighting national security issues.
For the renewal of the current (existing contracts) agreements also, the companies need approval of the government as per the National Security Directive on tele-communication sector.
Apart from the telecom gear makers, the IT department had recently also raided Chinese handset makers Oppo and Xiaomi's various offices and their linked persons. The department had claimed to have detected alleged unaccounted income worth over ₹6,500 crore due to violation of the Indian tax law and regulations.
On Monday, the government had also announced of a fresh ban list of 54 Chinese apps because they are either the cloned version or having similar functionality, privacy issue and security threats as alleged in previously blocked 267 apps in 2020.