ED conducts raids: The Enforcement Directorate has registered a money laundering case against Chinese mobile phone maker Vivo and its related companies and subsidiaries. The probing agency has registered the case after taking cognisance of an FIR and the searches were being carried out under sections of the Prevention of Money Laundering Act (PMLA).
Raids were conducted at 44 premises belonging to Vivo, associate companies, and sister companies. Last December, the Income Tax Department had searched Vivo and other Chinese mobile phone makers premises.
The federal agency filed a money laundering case after taking cognisance of a recent Delhi Police (economic offences wing) FIR against a distributor of the agency based in Jammu and Kashmir where it was alleged that a few Chinese shareholders in that company forged their identity documents.
The ED suspects this alleged forgery was done to launder illegally generated funds using shell or paper companies and some of these "proceeds of crime" were diverted to stay under the radar of Indian tax and enforcement agencies.
The action is being seen as part of the Union government's steps to tighten checks on Chinese entities and the continued crackdown on such firms and their linked Indian operatives that are allegedly indulging in serious financial crimes like money laundering and tax evasion while operating here.
The stepped-up action against the Chinese-backed companies or entities operating in India comes in the backdrop of the military stand-off between the two countries along the Line of Actual Control (LAC) in eastern Ladakh that is on for more than two years now.
The IT department had said that income of more than Rs 500 crore was wrongly declared. It is alleged that money was being misappropriated in the name of royalty.
The ED had earlier attached Xiaomi's bank accounts worth Rs 5,000 crore. But the Karnataka High Court had stayed the move. Xiaomi had claimed that the ED forced its top officials but the investigating agency had denied these allegations.