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From ZTE to HUAWEI And Xiaomi to One Plus: List of Chinese Firms Under Scanner For Tax Evasion in India

Popular Chinese telecommunication giants ZTE and Vivo are under the Income Tax Department's scanner for alleged financial irregularities and tax evasion.

Published: May 31, 2022 4:11 PM IST

By Business Desk | Edited by Manmath Nayak

From ZTE to HUAWEI And Xiaomi to One Plus: List of Chinese Firms Under Scanner For Tax Evasion in India

New Delhi: Chinese telecommunication giants ZTE and Vivo are under the scanner of the Income Tax Department of India for alleged financial irregularities, a report by Bloomberg stated this week, indicating an expansion of the ongoing probe into the finances and accounts of Chinese companies in the country.

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As per the report, the Ministry of Corporate Affairs has received information of alleged violations by the companies, including financial fraud. The Ministry will examine auditor reports.

The documents received by the Ministry of Corporate Affairs also stated that an investigation into Vivo was requested in April this year to determine if there were major irregularities in ownership and financial reporting.

In the wake of these developments, India has now intensified its investigation into Chinese firms doing business in the country. Since the time of the deadly Galwan Valley border clashes in 2020, the Indian government has also banned over 321 apps over security concerns.

Here’s a look at prominent Chinese firms which are under scanner in India:

ZTE: ZTE Corporation is a multinational telecommunications equipment and systems company which is headquartered in Shenzhen, Guangdong. It is one of China’s leading telecom equipment manufacturers.

In August 2021, the Income Tax department had raided its Gurgaon-based corporate offices and residences of senior executives of the company. As per reports, the raids by the Income Tax Department were conducted at the corporate office, residences of the foreign director, company secretary, accounts person and the cash handler of the firm’s foreign subsidiary company in India.

HUAWEI: The Income Tax department had on February 16, 2022 conducted searches at multiple premises of the Chinese telecom company in Delhi, Gurugram and Bengaluru as part of a tax evasion investigation. The tax officials has checked the financial documents, account books and company records as part of its investigation against the company, its Indian businesses and overseas transactions.

Notably, the raids were conducted days after the Information and Technology ministry blocked 54 more apps with Chinese links, including Tencent Xriver, Nice Video baidu, Viva Video Editor, and gaming app Garena Free Fire Illuminate, citing security and privacy concerns.

XIAOMI: Not just HUAWEI and ZTE, the income tax department had also raised the premises Xiaomi Corporation and had frozen $478 million worth of deposits in local bank accounts, news agency Reuters had reported on May 12. The raids were conducted as part of an investigation into alleged tax evasion. The report had quoted sources as saying that the fund freeze, carried out in February, was a fallout of the December raids conducted at Xiaomi India offices for alleged income tax evasion.

Xiaomi Corporation has separately challenged a block on $725 million of its funds by the Enforcement Directorate for alleged illegal foreign remittances.

One Plus: Apart from this, OnePlus was also among the Chinese mobile companies raided by the Income Tax Department in December 2021 on charges of tax evasion. The raids by the I-T department were carried out at premises of Xiaomi, Oppo and OnePlus in the National Capital Region, Mumbai, Bengaluru, Kolkata, Chennai and Hyderabad.

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