ED seizes Xiaomi’s assets worth Rs 5,551 crore for illegal forex remittances
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- Last Updated on 2 May, 2022
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The Enforcement Directorate (ED) has seized assets worth Rs 5,551 crore from Chinese company ‘Xiaomi’ for alleged illegal outward remittances. The technology giant is being questioned by federal agency for its alleged violation under the Foreign Exchange Management Act, 1999.
As per the report of ED, the company remitted foreign currency equivalent to Rs 5,551.27 crore to three foreign based entities including one Xiaomi group entity, in the guise of royalty. The amount remitted to other two US-based unrelated entities were also for the ultimate benefit of the Xiaomi group entities.
The ED said that ‘Xiaomi India’ procures completely manufactured mobile sets and other products from the manufacturers in India however it has not availed any service from these three foreign based entities to whom such amounts have been transferred. Thus, the company remitted the amount in guise of royalty abroad which results in violation of section 4 of FEMA, 1999. The ED also accused the company of providing “misleading information” to the banks while remitting the money abroad.
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