ED arrests Xiaomi CFO, former MD in Rs 5,551 crore foreign exchange violation case
Enforcement Directorate Notice: A major improvement has unfolded because the Enforcement Directorate (ED) just lately apprehended Xiaomi, a outstanding Chinese cell phone producer. Alongside the corporate, the ED additionally took into custody its Chief Financial Officer (CFO), Sameer B Rao, in addition to the former Managing Director (MD), Manu Kumar Jain. This transfer comes in gentle of a foreign change regulation violation case, involving a staggering quantity of over Rs 5,551 crore. Not stopping there, the ED has additionally issued present trigger notices to a few foreign banks, heightening the depth of the scenario.
Taking motion below the suitable part of the Foreign Exchange Management Act (FEMA), the Financial Investigation Agency has come forth with this important info. In their assertion launched on Friday, they highlighted that the Adjudicating Authority of FEMA has initiated motion by dispatching notices below Section 16 of the act. The recipients of those notices embody Xiaomi Technology India Private Limited, two of its officers, Citibank, HSBC Bank, and Deutsche Bank AG.
This latest improvement builds upon a big step beforehand taken by the ED. In the wake of concluding the investigation of a FEMA case, a present trigger discover is often issued. The recipient of this discover might face the consequence of paying a positive as much as thrice the quantity of the contravention. Alongside Xiaomi, Jain and Rao have additionally obtained this discover. It’s value noting that the ED had beforehand frozen Rs 5,551.27 crore held in the financial institution accounts of Xiaomi Technology India Pvt Ltd as a result of their involvement in illicit remittances.
Moreover, the ED has prolonged its attain to a few foreign banks, together with Xiaomi, by serving them with notices. The main goal is to hunt clarification relating to an quantity totaling Rs 5,551 crore, allegedly linked to foreign change violations. This newest transfer by the Enforcement Directorate has created fairly a stir in the business.
Expanding on the matter, the Enforcement Directorate has shed additional gentle on the scenario. It has come to their consideration that Xiaomi India has been transferring funds to its guardian firm since 2015. Remarkably, in the course of the course of the investigation, it was revealed that Xiaomi India commenced these remittances merely a yr after commencing operations in India in 2014. This revelation provides a layer of complexity to the case and raises pertinent questions concerning the firm’s monetary practices.
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