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DRI demands ₹4,389 crore from OPPO India for alleged customs duty violation

DRI demands ₹4,389 crore from OPPO India for alleged customs duty violation
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Indian tax authorities have issued a notice to Oppo Mobiles India Pvt. Ltd. demanding ₹4,389 crore after an investigation into alleged evasion of customs duty, finance ministry said in a statement on Tuesday.  

The demand for customs duty raised last Friday also proposed certain penalties on Oppo India, its employees and the parent company Guangdong Oppo Mobile Telecommunications Corp. Ltd., the statement said.  

The finance ministry said that Oppo India has voluntarily deposited ₹450 crore “as partial differential customs duty short paid by them.” An email sent to OPPO on Wednesday seeking comments for the story remained unanswered at the time of publishing. 

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Investigation into the alleged customs duty evasion was done by the Directorate of Revenue Intelligence (DRI). The total demand covers ₹2,981 crore of alleged availment of ineligible duty exemption benefits by Oppo India and alleged duty evasion related to payment of royalty and license fee to various multinational companies, including those based in China amounting to ₹1,408 crore, the ministry said. 

Such ‘royalty’ and ‘licence fees’ paid by Oppo India were not being added in the transaction value of the goods imported by them, in violation of the Customs Act, the ministry alleged. 

The ministry claimed that the senior management employees and domestic suppliers of Oppo India were questioned who in their voluntary statements accepted the submission of alleged wrongful description before the Customs Authorities at the time of import. 

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DRI conducted searches at the office premises of Oppo India and residences of its key management employees, the ministry said, adding that evidence indicating alleged wilful mis-declaration in the description of certain items imported by Oppo India for use in the manufacture of mobile phones was detected.