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Updated December 30th, 2023 at 18:28 IST

Delhi court grants extension of Vivo-India executives ED custody by two-days

The Delhi court on Tuesday extended the ED custody of three Vivo-India executives by 2 days, arrested in a money laundering case.

Abhishek Tiwari
Enforcement Directorate
The Enforcement Directorate is investigating a money laundering case related to Vivo-India. | Image:PTI/ Representational
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A Delhi court on Tuesday extended the Enforcement Directorate custody of three Vivo-India executives in a money laundering case by two days. The ED has been investigating the matter under sections of anti-money laundering law against the Chinese smartphone maker and others.

The three executives of the company were earlier arrested by the probe agency and were on Tuesday produced before the court after their three-day ED custody granted earlier by the court expired.

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Sources said that the ED had sought a five-day extension of the custody of the accused, however, the court granted two-days of extension. The probe agency claimed before the court that they were required to be confronted with the other accused arrested in the case earlier.

ED detects huge tax evasion during investigation

According to news agency PTI, Additional Sessions Judge Aparna Swami extended the custody of Interim CEO of Vivo-India Hong Xuquan alias Terry, Chief Financial Officer (CFO) Harinder Dahiya and consultant Hemant Munjal on an application moved by the ED.

Four people were earlier arrested in the case by the federal agency including mobile company Lava International's MD Hari Om Rai, Chinese national Guangwen alias Andrew Kuang, and chartered accountants Nitin Garg and Rajan Malik.

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Meanwhile, China on Monday had said it will provide consular protection and assistance to the arrested employees working for smartphone maker Vivo in India and expressed its firm backing to the Chinese businesses in protecting their lawful rights and interests.

A charge sheet was filed by the ED against the four in a special PMLA (Preventions of Money Laundering Act) court in Delhi. The ED had alleged that the activities of the four arrestees enabled Vivo-India to make wrongful gains that were detrimental to the economic sovereignty of India.

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After the matter came to fore, the enforcement agency had raided Vivo-India and people linked to it in July last year. Following the raids, the agency claimed to have busted a major money laundering racket involving Chinese nationals and multiple Indian companies. As per ED’s allegations, around Rs 62,476 crore was illegally transferred by Vivo-India to China to avoid payment of taxes in India, reports the news agency.

The company had, however, said that it firmly adheres to its ethical principles and remains dedicated to legal compliance.

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Lava International's Hari Om Rai had recently told a court that though his company and Vivo-India were in talks to launch a joint venture in India a decade ago, he had nothing to do with the Chinese firm or its representatives since 2014.

"He has not derived any monetary benefit nor has he engaged in any transaction with Vivo-India or any entity allegedly related to Vivo, let alone having been associated with any alleged proceeds of crime," Rai's lawyer Nitesh Rana had told the court.

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The probe agency filed an enforcement case information report (ECIR), on February 3 after studying a December 2022, Delhi Police FIR against an associated company of Vivo-India, its directors, shareholders and some other professionals.

As per the report, the crackdown on the leading Chinese company came after the federal agency found that three Chinese nationals, all of whom left India between 2018 and 2021, along with an Indian national incorporated 23 companies in India with the alleged assistance of chartered accountant Nitin Garg.

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Further, the ED alleged that the 23 companies incorporated in India were found to have transferred huge amounts of funds to Vivo India. Out of the total sale proceeds of Rs 1,25,185 crore, Vivo India remitted Rs 62,476 crore or almost 50 per cent of the turnover out of India, mainly to China, reports PTI.

These remittances were made to disclose huge losses in Indian incorporated companies to avoid payment of taxes in India, the agency added.

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The action is seen as part of the Union government's effort to tighten the screws on Chinese entities that are allegedly indulging in serious financial crimes like money laundering and tax evasion while operating here.
 

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Published December 26th, 2023 at 20:47 IST

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