Oppo India Accused of Evading Customs duty amounting to Rs4,389 Crores

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Oppo India Accused of Evading Customs duty amounting to Rs4,389 Crores

This week, Vivo was under the surveillance of Indian authorities due to allegations of financial fraud as well as tax avoidance. The company’s sister Oppo is being investigated for similar charges. Its Directorate of Revenue Intelligence (DRI) conducted an investigation into Chinese Phone manufacturer Oppo to discover the customs duty evasion that amounted to $ 4389 million.

DRI conducted searches on Oppo India’s office and at the homes of its top management personnel during the this investigation. The results led to the discovery of evidence incriminating of intentional misrepresentation in the description of specific items that were imported from Oppo India for use in the production of mobile phones.

Oppo India seems to be in trouble, but it’s not the only one. This week Vivo India was the target of Enforcement Directorate (ED)-India’s financial watchdog-conducted raids on Vivo and its related firms in over 40 locations all over India as part of a money-laundering probe. The ED stated the fact that Vivo India “remitted” almost 50 percent of its revenues in China so as to dodge taxation.

“During an investigation into the company M/s Oppo Mobiles India Private Limited (hereinafter known as Oppo India), a subsidiary belonging to Guangdong Oppo Mobile Telecommunications Corporation Ltd, China (hereinafter referred to as Oppo China), the Directorate of Revenue Intelligence (DRI) has discovered customs duty fraud of about 489 crore rupees,” the finance ministry announced in a statement on Wednesday.

Also Read: Vivo Y55 launches in Pakistan with sharp photography and superior performance

According to the Finance Ministry, the investigation also found the fact that Oppo India made various provisions to pay ‘royalty as well as a licensing fee to various global firms as a condition of using proprietary technology/brand/IPR licences and other licenses.

“The expense of ‘Royalty’ as well as “Licence Fees” which were paid to Oppo India were not being included in the value of the products imported by them, which is in violation of Section 14 of the Customs Act, 1962, as interpreted by Rules 10 and 11 of the Customs Valuation (Determination of Value of Imported Goods) Rules 2007. The alleged duty evasion committed by the company M/s Oppo India on this account is. 1,408 crores.” read the statement.

An Order to Show Cause has been sent by Oppo India asking the Customs duty amounting to the sum of Rs. 4,389 crores. The notice also proposes penalties for Oppo India, its workers and Oppo China in accordance with the regulations in the Customs Act of 1962.

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