Bangalore: The Enforcement Directorate (ED) has seized assets worth Rs 5,551 crore from Chinese mobile phone maker Shomi. The ED said Rs 5,551.27 crore was seized from four bank accounts. The action is for violating the Foreign Exchange Rules. Shomi India is a wholly owned subsidiary of the China-based Shomi Group.
In February, the ED launched an investigation into allegations that the company had sent money illegally. Shaomi has an annual turnover of Rs 34,000 crore in India. The action is in accordance with the Foreign Exchange Management Act (FEMA) of 1999. Shomi has been operating in India since 2014. The ED probe was into financial transactions conducted since 2015. A large portion of the proceeds went to Shomi India, the parent company.
Shomi India had entered into agreements with Indian companies to manufacture handsets. However, the ED found that Shomi India had not provided technical support or assistance to the manufacturers and had illegally transferred money to three foreign companies without accepting any kind of service.
English Summary: ED seizes Rs 5,551 crore of Xiaomi India under FEMA law