ED seizes Rs 5,551 crore of Xiaomi India under FEMA law

Days after it questioned Chinese mobile manufacturer Xiaomi’s global vice-president for alleged forex violations by the company, the Enforcement Directorate (ED) on Saturday seized Rs 5,551.27 crore belonging to Xiaomi Technology India Private Limited under the provisions of the Foreign Exchange Management Act,1999.

Xiaomi India is a wholly owned subsidiary of the China-based Xiaomi group. According to the ED, the seized amount was lying in the bank accounts of the company. The ED had initiated an investigation in connection with the illegal remittances made by the company in the month of February this year.

Earlier this month, the agency had questioned Manu Kumar Jain, Xiaomi’s global vice-president, in connection with the case.

In a statement, ED 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 crore to three foreign based entities which include one Xiaomi group entity in the guise of Royalty. 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 was also for the ultimate benefit of the Xiaomi group entities.”

According to ED, Xiaomi India is a trader and distributor of mobile phones in India under the brand name of MI.

Leave a Comment

Your email address will not be published.