Samsung India served show-cause notice by DRI: Report

SIEL had hired PwC for classification of the network equipment, which is under scanner.

The Directorate of Revenue Intelligence (DRI) has issued a show cause notice to Samsung India Electronics (SIEL), The Economic Times reported on January 12. The agency has asked the South Korea's Samsung Electronics why it should not recover the Rs 1,728.47 crore along with interest for alleged customs duty evasion, according to the report. The notice was issued by Nhava Sheva Customs earlier this week, it added.

The issue pertains to alleged misdeclaration and misclassification of remote radio head (RRH), a networking device, by Samsung India to avail undue exemption of basic customs duty, the report said. SIEL had hired PwC for classification of the network equipment, which is under scanner.

Moneycontrol could not independently verify the report.

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The DRI, in the notice, has also asked why a penalty should not be imposed against the senior management of the company. Reportedly, it has also issued the notice to PricewaterhouseCoopers Pvt Ltd (PwC) and an associate director, who was questioned during the probe. SIEL, PwC have 30 days to reply to notice.

SIEL and PwC did not respond to the queries sent by ET till press time.

The DRI in its notice has asked SIEL, "the impugned goods, having total accessible value of Rs 6,72,821 crore, imported under the bills of entry should not be held liable for confiscation under the provisions of section 111 (m) of the Customs Act, 1962", the report said quoting a person aware of the matter. The agency has also asked why the "differential duty (of) Rs 1,728.47 crore in respect of the bills of entry should not be demanded and recovered from them under the provisions of section 28 (4) of the Customs Act, along with interest at the applicable rate", it added.

The DRI has also asked why it should not adjust Rs 300 crore deposited by SIEL towards payment of differential duty.