homebusiness Newscompanies NewsVivo Mobiles India case: Delhi court sends Lava International's MD, 3 others to 3 days of ED remand
Vivo Mobiles India case: Delhi court sends Lava International's MD, 3 others to 3 days of ED remand
The action comes after a series of raids conducted across India, involving 48 locations last year, which included the premises of Vivo Mobiles India and 23 associated companies, including Grand Prospect International Communications (GPICPL).
A Delhi court on Tuesday, October 10, granted the Enforcement Directorate (ED) with 3 days custody of all 4 executives including Hari Om Rai, Founder of Lava International, accused in the Vivo Mobiles India case. The development follows after ED sought the custody of the said accused citing that they've been evasive, non-cooperative during questioning.
Notably, ED arrested the four executives of Chinese mobile manufacturer Vivo Mobiles India, including a Chinese citizen, as part of an ongoing investigation into alleged money laundering activities, after the raids conducted on October 9.
The ED, in its plea to the court while seeking remand for Hari Om Rai, revealed critical details regarding his alleged role in facilitating Vivo India's operations in India. According to the ED, Hari Om Rai was the main conspirator in creating a mesh of companies, circumventing Foreign Direct Investment (FDI) norms and helping Vivo India establish sizable base in India.
The ED claimed that the initial funding of 3.17 crore for setting up official and residential accommodation for Chinese nationals working for Vivo India was provided by Hari Om Rai and Lava India. However, no agreement or collateral was exchanged between Vivo India and Lava India for transfer of such funds.
The probe agency contended that this transaction was not genuine, further indicating their involvement in aiding Vivo and its Chinese owner, BBK, in establishing a substantial presence in India.
This action comes after a series of raids conducted across India, involving 48 locations last year, which included the premises of Vivo Mobiles India and 23 associated companies, including Grand Prospect International Communications (GPICPL).
It must be noted here that Lava is among the 16 beneficiaries of the government's production-linked incentive (PLI) scheme.
The ED's probe under the Prevention of Money Laundering Act (PMLA) was initiated on February 3, 2022, following an FIR filed by the Delhi Police. The FIR was registered based on a complaint lodged by the Ministry of Corporate Affairs, accusing GPICPL of fraud, cheating, and criminal conspiracy.
The ED alleges that multiple companies were incorporated in India with the primary purpose of transferring funds to China illicitly. Furthermore, the investigation reveals that Vivo Mobiles India had transferred a substantial portion, approximately half of its sales proceeds amounting to Rs. 1.25 lakh crore, to China, allegedly to evade taxes in India.
First Published: Oct 10, 2023 3:25 PM IST
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