ED Seizes ₹5.5kcr of Xiaomi in FEMA Case

The Enforcement Directors (ED) said it seized ₹5,551.27 crore belonging to Xiaomi Technology India Pvt Ltd (Xiaomi India) on Saturday, nearly a fortnight after it questioned Manu Kumar Jain, the company’s global vice president. The company is being investigated for alleged violations of the Foreign Exchanges Management Act (FEMA) since February pertaining to suspected illegal remittances made by it, the ED said in a statement. Xiaomi India is a wholly owned subsidiary of the China-based Xiaomi Group. “This amount of ₹ 5,551.27 crore lying in the bank accounts of the company has been seized by the ED,” the agency said. Sources said the agency is investigating the company’s foreign funding, shareholding. Financial statements and related activites. Jain’s statement had been recorded at the agency’s Bengaluru office. The company denied any wrong doing and said it would cooperate with government agencies. “As a brand committed to India, all our operations are firmly compliant with local laws and regulations. We have studied the order from government authorities carefully,” said a Xiaomi spokesperson. “We believe our royalty payments and statements to the bank are all legit and truthful. These royalty payments that Xiaomi India made were for the in-licensed technologies and intellectual property used in our Indian version products. It is a legitimate commercial arrangement for Xiaomi India to make such royalty payments. However, we are committed to working closely with government authorities to clarify any misunderstandings.” S-ET

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