NEW DELHI: The Directorate of Revenue Intelligence (DRI) conducted searches at the office premises of Oppo India and residences of its key management employees, which led to the recovery of incriminating evidence indicating wilful misdeclaration in the description of certain items imported by the company, which were meant for use in the manufacture of mobile phones.
The revenue intelligence agency, in a statement, said it has detected customs duty evasion of around Rs 4,389 crore.
According to the DRI, an investigation pertaining to Oppo Mobiles India, a subsidiary company of Guangdong Oppo Mobile Telecommunications Corporation Ltd, China, was conducted in January and senior management employees and domestic suppliers of Oppo India.
During the questioning, employees, in their voluntary statements, accepted the submission of wrongful description before the Customs authorities at the time of import. Those mis-declarations resulted in wrongful availment of ineligible duty exemption benefits by Oppo India amounting to Rs 2,981 crore.
The investigation also revealed that Oppo India had remitted or made provisions for payment of royalty and licence fee to various multinational companies, including those based in China, in lieu of the use of proprietary technology/brand/IPR licence.
The royalty and licence fees paid by Oppo India were not being added to the transaction value of the goods imported by them, in violation of Section 14 of the Customs Act, 1962, read with Rule 10 of the Customs Valuation Rules 2007. The alleged duty evasion by Oppo India on this account is Rs 1,408 crore.
A sum of Rs 450 crore has been voluntarily deposited by Oppo India, as partial differential Customs duty short-paid by it.
After completion of the investigation on July 8, a show-cause notice has been issued to Oppo India demanding Customs duty amounting to Rs 4,389 crore. The said notice also proposes relevant penalties on Oppo India, its employees and Oppo China, under the provisions of the Customs Act, 1962.
Oppo India is engaged in the business of manufacturing, assembling, wholesale trading, and distributing mobile handsets and accessories across India. Oppo India deals in various brands of mobile phones, including Oppo, OnePlus, and Realme. (ANI)