August 8, 2022
ED reportedly asks court to reinstate Xiaomi’s 5 million bank assets

India’s financial crime-fighting agency on Thursday asked a court to again freeze $725 million (about Rs 5,624 crore) in Xiaomi’s Indian bank accounts as it probes fund transfers by the Chinese smartphone giant.

The Enforcement Directorate had seized the money saying that Xiaomi had illegally transferred money abroad to three entities, including one in the Xiaomi group, describing them as payments “under the guise of royalties”.

But the High Court in the southern state of Karnataka stayed that decision when Xiaomi challenged it, saying all royalty payments were valid.

The stay decision will continue, a judge of the same court said on Thursday, adding that the agency would make a formal request later to reinstate the freeze.

“The matter requires further hearing,” Justice Siddappa Sunil Dutt Yadav said. He fixed the next hearing for May 23.

A Xiaomi spokesperson did not immediately respond to a request for comment.

Xiaomi’s lawyers told the court that the banks were not allowing the company to make the required payments, even though the court had allowed it to use the funds for purposes other than royalty payments.

On Thursday, the judge allowed Xiaomi to use the bank overdraft facility for such payments.

The agency’s move comes after Xiaomi filed in court that its top executives faced threats of “physical violence” and coercion during interrogation by enforcement officials, arguments that the agency dismissed as untrue. Have given.

© Thomson Reuters 2022


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