The four people arrested by the ED were taken into custody under the Prevention of Money Laundering Act (PMLA).
The Enforcement Directorate had previously held a raid on Vivo and people linked with it in July 2022.
Vivo India made a total sale of ₹1,25,185 crore in the said year but had set aside ₹62,476 crore.
Vivo was recently in the news and not for the usual reasons. The Chinese smartphone company has found itself in the middle of a money laundering case. In the wake of the case, the Enforcement Directorate (ED) has arrested four people, including the MD of Lava as well as a Chinese national. Let’s find out what this case is all about.
According to the PTI report, four people arrested by the ED were taken into custody under the Prevention of Money Laundering Act (PMLA). The arrested people are Hari Om Rai, the MD of Lava International company, Chinese national Guangwen Kyang, Chartered Accountant Nitin Garg, and a person called Rajan Malik.
Now why were these arrests made? The report revealed that the Enforcement Directorate had previously held a raid on Vivo and people linked with it in July 2022. After the raid, they claimed to have busted a major money laundering scandal. It involved many Indian companies as well as Chinese nationals.
Post this, the ED allegedly informed that in order to skip tax payments in India, Vivo transferred a whopping ₹62,476 crore to China from India.
How did the ED get to know about this?
The ED tracked down this alleged racket after it figured out that three Chinese nationals who had previously departed from India between 2018 and 2021 along with another Chinese person had incorporated 23 companies in India. It is alleged that they were helped by CA Nitin Garg in this.
Now these companies had transferred large amounts into Vivo India’s accounts.
Further, Vivo India made a total sale of ₹1,25,185 crore in the said year but had set aside ₹62,476 crore, which is more than half of the turnover, and said that it was made outside India and majorly in China. As per the ED, they did so to show a major loss and hence avoid paying the taxes liable to them.
Also read: Can India’s Lava Agni 2 fight the Chinese giants with its attractive price tag?
After the raid in July last year, Vivo India said that it was “a responsible corporation and was committed to being fully compliant with laws.”
Now let’s see how this case unfolds and what actions are eventually taken.
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Mustafa Khan
Mustafa is new on the block and is a tech geek who is currently working with Digit as a News Writer. He tests the new gadgets that come on board and writes for the news desk. He has found his way with words and you can count on him when in need of tech advice. No judgement. He is based out of Delhi, he’s your person for good photos, good food recommendations, and to know about anything GenZ. View Full Profile
