The Enforcement Directorate on Saturday said it had seized ₹5,551.27 crore belonging to Xiaomi Technology India Pvt Ltd – a ‘wholly-owned subsidiary of China-based Xiaomi group’.
The probe agency said the money was in bank accounts belonging to the Chinese smartphone giant and had been seized in connection with alleged ‘illegal outward remittances’ in February.
“Xiaomi India is wholly owned subsidiary of China-based Xiaomi group. This amount of ₹5,551.27 crore lying in the bank accounts of the company has been seized by the Enforcement Directorate,” the agency said in a statement.
The seizure of funds has been done under relevant sections of the Foreign Exchange Management Act (FEMA) after a probe was launched by the federal agency against the company in connection with alleged “illegal remittances” sent abroad by the Chinese firm in February.
Xiaomi India has not availed any services from the 3 entities which were beneficiaries of these huge transactions. Such huge amounts in the name of royalties were remitted on instructions of the Chinese parent group, the ED has alleged. Xiaomi is also accused of providing misleading information to the banks while transferring this money abroad.
ED, which is probing the company since February, had earlier asked Manu Kumar Jain, former India managing director, to appear before the agency for questioning in the case.
According to Reuters, the ED is probing the existing business relationship between Xiaomi India, contract manufacturers, and the parent entity in China.
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