FEMA Authority rubber-stamps Rs 5551.27 Cr seizure against Xiaomi India

Biggest seizure of the Indian history

Main Image
  • Like
  • Comment
  • Share

Considering all that is going on between Xiaomi and the government of India, it seems like the troubles of the brand are not going to end anytime soon. Recently, the Competent Authority appointed under Section 37A of the Foreign Exchange Management Act has put a stamp on a seizure of Rs 5551.27 crore forwarded by the Directorate Enforcement (ED) against Xiaomi Technology India Private Limited. As per the record, this is the highest amount of seizure orders in India, and the Authority has also confirmed the same.

In a statement released by the Competent Authority, it has been mentioned that ED has done the right thing by holding foreign exchange equal to the amount of Rs 5551.27 crore. The amount has been tranferred from India by Xiaomi India in an unauthorized manner, and it is kept outside the country on behalf of the group entity. The same amount is in contravention of Section 4 of the Foreign Exchange Management Act, 1999, and the same is supposed to be seized in terms of provisions of Section 37A of the FEMA.

Another major highlight of the whole scenario is that the payment of royalty is being used as a tool to transfer the foreign exchange out of India, and it is a clear violation of provisions set by FEMA. Not only this, but Xiaomi also provided misleading information to the banks at the time of remitting the money.

Previously, ED seized a total amount of Rs 5551.27 crore of M/s Xiaomi Technology India Private Limited under the provisions of the Foreign Exchange Management Act, 1999. Xiaomi, without any authorization, remitted this amount in the name of royalty abroad, which violates Section 4 mentioned in FEMA.

In response to the scenario, Xiaomi India has filed a writ petition before the High Court of Karnataka against the orders. The petition was dismissed by the Honorable High Court. Xiaomi India is completely owned by the Xiaomi group based out in China. The amount of Rs 5551.27 crore has been remitted to three foreign entities by the Xiaomi Group. Until now, Xiaomi has not used any service from foreign entities in exchange for the amounts transferred.

Nishit Raghuwanshi RudraNishit Raghuwanshi Rudra
A career journalist who spent three plus years playing around with smartphones, associated apps and more. As a hobby, Rudra enjoys researching mobile games. When he's not busy in the world of gadgets, he is busy with a paper and pen writing poems or engaging with his growing digital audience on the Hindi rap circuit.

Related Articles

ImageSmartprix People’s Choice Awards 2023: Vote for Your Favorite Smartphones, Smartwatches, and More

As we bid farewell to the smartphone launches that defined 2023, it’s time to reflect on the industry’s journey. The landscape witnessed a myriad of captivating releases, such as Apple pioneering the use of a 3nm chipset in their phones and OnePlus boldly venturing into the realm of foldable devices. Brands like Realme brought curved …

ImageXiaomi’s Allegations of Coercion Baseless, Enforcement Directorate Says

After an allegation filed by Xiaomi dated May 4th, the Enforcement Directorate (ED) has officially made a statement that the allegations are “baseless” and that the agency tried to record statements of Xiaomi India’s top executives under coercion. ED says that the allegations made by Xiaomi India are ‘baseless’ According to the latest update, the …

ImageXiaomi slapped with ₹653 cr notice for tax evasion in India

Chinese smartphone maker Xiaomi has been charged with customs duty evasion worth Rs. 653 crore in India, Finance Ministry said on Wednesday. The Revenue Intelligence team of the Income Tax Department conducted thorough searches of Xiaomi India offices in India and found that the company has evaded custom duty of up to Rs. 653 crores …

ImageXiaomi India Gets ED Notice Over Alleged Illegal Remittances Worth Rs 5,551.27 Crore

The Enforcement Directorate (ED) has issued show-cause notices to Xiaomi India, a prominent Chinese mobile manufacturer, and its top officials, including CFO Sameer Rao and former MD Manu Jain, along with three banks, over alleged foreign exchange violations amounting to Rs 5,551.27 crore. The ED’s investigation follows a complaint lodged by the agency regarding illegal …

ImageXiaomi Redmi A2 Series launched in India starting at Rs. 5999

Xiaomi India has launched a host of new products today that cater to the budget segment of consumers in the country. Redmi A2 Series has officially been unveiled in India that includes 2 smartphones- Redmi A2 and Redmi A2+. The successor to the previously launched Xiaomi Redmi A1, this new series promises to do better …


Be the first to leave a comment.