ED calls on Xiaomi global vice president Manu Kumar Jain in forex business

Chinese mobile phone maker Xiaomi has come under the scanner of the Enforcement Directorate (ED). The federal agency has summoned its global vice-president Manu Kumar Jain in connection with alleged foreign remittances of Rs 1,000 crore, which according to the agency does not comply with the rules for foreign exchange.

“This is the third call issued to him (Jain) after he did not appear on the previous call,” a senior official said. He was asked to appear in front of the office of the office in Bengaluru on Wednesday, the official said without giving details.

According to sources, Jain had been the former CEO of Xiaomi of its operations in India and therefore he could be aware of business activities and the significant amount that is being transferred outside India.

It is learned that ED had initiated its discreet inquiry in February under the Foreign Exchange Management Act (FEMA) and found evidence of remittances involving a significant amount.

Upon contact, a Xiaomi spokesman said: “Xiaomi is an law-abiding and responsible company. We give the utmost importance to the laws of the land. We fully comply with all regulations and are confident of them.”

“We are working closely with authorities in their ongoing investigation to ensure they have all the necessary information,” it added.

Sources said Jain was asked to provide details about Xiaomi’s various shareholders, financing and financial statements, in addition to necessary approval details.

Chinese phone makers and their subsidiaries have been under the lens of Indian probe agencies. In December-January, the IT department conducted searches at various offices of these companies in multiple cities. The department had said that these companies sent money in the form of royalties quoting themselves and group companies abroad, that is in thousands of kroner.

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