Vivo India transferred Rs 62,476 crore to China to avoid taxes

Tags: Economy/Finance National News

According to a statement issued by the Enforcement Directorate, Rs 62,476 crore has been "illegally" transferred to China by smartphone maker Vivo to evade payment of taxes in India between 2017 and 2021.

• Important facts 

• 18 companies that were incorporated fraudulently helped the smartphone maker Vivo to transfer 50 percent of the turnover outside India to mainly China. 

• Under the provisions of the Prevention of Money Laundering Act (PMLA), 119 bank accounts of entities with a gross balance of Rs 465 crore have been seized so far.

• While transferring money to China, Vivo India has shown losses in most of its associate firms.

• The Ministry of Corporate Affairs (MCA) has filed a police complaint against Vivo's subsidiary Grand Prospect International Communication Pvt Ltd (GPICPL), its directors, shareholders, certifying professionals etc.

• Prevention of Money Laundering Act

• It was enacted in 2002 and came into force in 2005.

• The objective of the Act is to prevent money laundering, that is, the process of converting black money into white.

• The Act empowers government officials to confiscate property acquired through illegal sources and money laundering.

• Under the Act the burden of proof lies with the accused, who has to prove that the suspect property has not been obtained through unfair means.

• Enforcement Directorate

• It is a specialised financial investigation agency under the Department of Revenue, Ministry of Finance, Government of India.

• It is a law enforcement and economic intelligence agency responsible for enforcing economic laws and fighting economic crime in India.

• Its name was changed to Enforcement Directorate (ED) in 1957.

• Its headquarters is in New Delhi and has many regional offices all over the country.

• The Directorate of Enforcement (ED)  - Sanjay Kumar Mishra