DRI detects customs duty evasion by Oppo Mobiles
A show-cause notice has been issued to the company proposing penalties on it and its China counterpart
DRI detects customs duty evasion by Oppo Mobiles A show-cause notice has been issued to the company proposing penalties on it and its China counterpart The Directorate of Revenue Intelligence (DRI) has uncovered a customs duty evasion of around Rs.4,389 crore by Oppo Mobiles India Private Limited. The evasion was detected during the investigation pertaining to Oppo India, a...
DRI detects customs duty evasion by Oppo Mobiles
A show-cause notice has been issued to the company proposing penalties on it and its China counterpart
The Directorate of Revenue Intelligence (DRI) has uncovered a customs duty evasion of around Rs.4,389 crore by Oppo Mobiles India Private Limited. The evasion was detected during the investigation pertaining to Oppo India, a subsidiary company of Guangdong Oppo Mobile Telecommunications Corporation Limited, China.
Oppo India is engaged in manufacturing, assembling, wholesale trading, and distribution of mobile handsets and accessories across India. It deals in various brands of mobile phones, including Oppo, OnePlus, and Realme.
The searches conducted by DRI at the offices of Oppo India and residences of its key management employees led to the recovery of incriminating evidence. It indicated wilful misdeclaration in the description of certain items imported by Oppo India for manufacturing mobile phones. This resulted in wrongful availment of ineligible duty exemption benefits amounting to Rs.2,981 crores.
The senior management employees and domestic suppliers of Oppo India were also questioned. In their voluntary statements, they accepted the submission of wrongful description before the Customs Authorities at the time of import.
The investigation also revealed that Oppo India had remitted/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 license, etc. These were not added to the transaction value of the goods imported by them, in violation of the Customs Act, 1962, read with Rule 10 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
The alleged duty evasion by Oppo India on this account was Rs. 1,408 crores. A sum of Rs.450 crores was voluntarily deposited by the company as partial differential customs duty short paid by them.
A show-cause notice was issued to Oppo India demanding the customs duty. Under provisions of the Customs Act, the notice also proposes relevant penalties on the company, its employees, and Oppo China.