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The company denied in an affidavit submitted to the high court that it sent money to China to avoid payment of taxes in India. It said the remittances have a “legitimate basis and were towards the procurement of raw material and other services required for the mobile manufacturing business of the company”. In its affidavit, seen by ET, the company said it “procures and imports certain components and raw materials from China for manufacturing its products, and duly remits payments for the same to its suppliers”. The components imported from China include motherboards, semiconductors, printed circuit boards and sensors, it said.
The company said that “importantly, it is in the process of constructing a new manufacturing unit in India, for which it procures services related to consultancy, market research, architecture and R&D from China.”
Freezing of A/cs Illegal, Says Co
It has paid the requisite custom duties towards such imports from China and other countries.
The company said that the ED seized data and documents belonging to the company during its search operations on July 5. “These include the underlying documentation for all the company’s transactions, including the transactions with respect to China,” Vivo India said in its affidavit.
As first reported by ET on Sunday, the ED had said in its affidavit to the high court that the alleged laundering “has been carried out as an attempt to destabilise the financial system of the country and also to threaten the integrity and sovereignty of the nation”. The agency had cited a 2020 Orissa High Court judgement that described money laundering as an act of “financial terrorism”.
Vivo India said this citation was “merely a misplaced attempt to create an atmosphere of apprehension and suspicion around the company”.
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