Chinese tech-giant Xiaomi is currently undergoing some legal issues in India. The country’s federal financial crime agency had seized the company’s fund worth INR 5,551 crores back in the month of April. The assets were reportedly seized because of some illegal transactions made by the brand to foreign entities by passing them as royalty payments.
Xiaomi urges Karnataka High Court for relief of seized assets
Xiaomi denied the claims made by the Enforcement Directorate of India. The brand further claims that every transaction is done from their end by legal and no illegal things have been ever done by the brand and its entities.
The court ruled that the company must first provide bank guarantees covering the $676 million in frozen assets before considering Xiaomi’s lawyer Udaya Holla’s request to end the freeze. According to Holla, such bank guarantees would require depositing the entire sum, making it difficult for the business to operate, pay salaries, and make inventory purchases in advance of the Hindu festival of Diwali, which coincides with a spike in consumer spending in India.
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The court postponed the case until October 14 after declining to grant any immediate relief. In addition to requesting the bank guarantees, Nargund M. B., one of India’s Additional Solicitor Generals, who was speaking on behalf of the Enforcement Directorate, urged the court to deny Xiaomi any immediate relief.
The brand has already given their statement saying that all the accusations thrown at them by the Enforcement Directorate are wrong, and has also said that royalty payments made by their end were all legitimate and truthful and do not brake any legal barrier of the country.
