NAME : VISHAL RADHAKRISHNA KURUP
ROLL NO : M2160
FY MMS
VIVO CASE STUDY
CASE STUDY
INTRODUCTION OF THE CASE :
Recently Vivo India’s almost 23 associated firms such as Grand Prospect International Communications Pvt Ltd also known as (GPICPL) transferred huge amounts of its income to the parent firm , out of total sales proceeds of Rs1,25,185 crores the company remitted Rs 62,476 crores that is almost 50% of the total income out of India and most of the amount was remitted to China .
COMPANY DETAILS :
Vivo Communication Technology Co. Ltd., (styled as vivo), is a Chinese multinational technology company headquartered in Dongguan, Guangdong that designs and develops smartphones, smartphone accessories, software and online services. The company develops software for its phones, distributed through its V-Appstore, with Manager included in their proprietary, Android-based operating system, Funtouch OS in Global, Origin OS in Mainland China and India. Vivo is an independent company and develops its own products. It has 10,000 employees, with research and development centers in Shenzhen, Guangdong, and Nanjing, Jiangsu.
CASE DETAILS :
On Thursday it came to light after ED alleged that nearly twenty three firms associated with the Chinese company including GPICPL that sale proceeds of Vivo India were transferred out of India to show losses and avoid paying taxes. The Enforcement Directorate conducted searches at more than 40 locations including Uttar Pradesh, Madhya Pradesh and some southern states in connection in connection with a money laundering case registered against Chinese smartphone manufacturer Vivo. Currently IT department, as well as the Ministry of Corporate Affairs, are also keeping a close eye on the Chinese manufacturing firms. The ED raid is an extension of the probe against Chinese firms. These allegations caused the directors of the company to flee from the country and scince the bank accounts linked to the firm have been blocked. The Enforcement Directorate counted these searches with respect to violations of the Prevention of Money Laundering Act (PMLA).
OUTCOME OF THE CASE :
The directors of the company Zhengshen Ou and Zhang Jie of a firm GPICPL, in association with mobile maker Vivo, fled India last year, an Enforcement Directorate official informed on Thursday. The official corrected the report which mentioned that Zhengshen Ou and Zhang Jie were directors of Vivo and they fled when the ED intensified its inquiry into the money laundering case against the Chinese firm. The local units of Vivo Mobile Communications are since under the radar for alleged financial improprieties as part of the investigation into other China based firms.This is the second biggest case the Enforcement Directorate has registered against a Chinese company as earlier Xaomi another cellphone comapny was booked for the violation of Foreign Exchange Management Act (FEMA).