Vivo, a Chinese smartphone manufacturer, has been charged by the Enforcement Directorate for money laundering, according to official sources on Thursday. The charge sheet was filed under the criminal sections of the Prevention of Money Laundering Act (PMLA) on Wednesday, PTI reported citing sources. Vivo India has been accused along with several others, including four individuals who have already been arrested in connection with the case.
Among those arrested are Hari Om Rai, the MD of Lava International mobile company, Chinese national Guangwen (also known as Andrew Kuang), and chartered accountants Nitin Garg and Rajan Malik.
The Enforcement Directorate (ED) had accused four individuals of engaging in activities that helped Vivo-India gain wrongful profits, which adversely affected India's economic sovereignty. In July last year, the ED conducted a raid on Vivo-India and its associates, alleging that they were involved in a significant money laundering scheme that included Chinese nationals and several Indian firms.
The ED claimed that Vivo-India illegally transferred Rs 62,476 crore to China to avoid paying taxes in India. Vivo-India denied the allegations and said it followed ethical principles and complied with the law.
Recently, the founder of Lava International, Hari Om Rai, told a court that he had nothing to do with Vivo or any of its representatives since 2014.
Although Lava International and Vivo-India were in discussions about establishing a joint venture in India a decade ago, he did not benefit financially nor engage in any transaction with Vivo or its associates. Rai's attorney made these statements to the court.
The ED filed an Enforcement Case Information Report (ECIR), which is the ED's equivalent of a police FIR, on February 3, after examining a Delhi Police FIR filed against Grand Prospect International Communication Pvt Ltd (GPICPL), its directors, shareholders, and some other professionals affiliated with the company.
The complaint was filed by the Corporate Affairs Ministry and alleged that GPICPL and its shareholders used fake identification documents and false addresses when incorporating the company in December 2014.
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