The amount is around half of Vivo India’s total sales of about 1.25 trillion rupees earned since opening for business here in 2014.
“These remittances were made in order to disclose huge losses in Indian incorporated companies to avoid payment of taxes in India,” the agency said in a statement.
The disclosure came the week that the agency raided properties of Vivo India and associated businesses across 48 locations. The agency said it seized assets including 119 bank accounts with a gross balance to the tune of 4.65 billion rupees and 2kg in gold bars.
A Vivo spokesperson did not immediately respond to a request for comment.
The unravelling of Vivo India follows a similar clampdown on Xiaomi. In January, a local unit was ordered to pay US$88 million in import taxes that it allegedly owed for the period between 2017 and 2020.
It was dealt another blow in April, when the anti-money-laundering agency seized about US$730 million after a probe found that the unit broke India’s strict currency laws when it remitted money to three foreign entities.
Xiaomi has denied any wrongdoing.
Four Chinese companies – Xiaomi, Oppo, Vivo and Realme – together held about 60% of the Indian smartphone market in the January-March quarter, according to Counterpoint Research.
An initial probe of Vivo pointed the agency to an entity incorporated in the northern hillside city of Shimla and set up with the assistance of an Indian. The unit had three Chinese directors.
Shareholders in the unit “had used forged identification documents and falsified addresses at the time of incorporation”, the agency said, adding that the probe revealed the one of the addresses mentioned by the directors of the Shimla-based unit was that of a government building, and the other a senior bureaucrat’s house.
The Chinese directors, the agency alleged, left India in 2018 and 2021. It said two of them had set up a maze of 22 companies “found to have transferred huge amount of funds to Vivo India”.
Experts note that the high-profile raids on Vivo and Xiaomi came as tensions simmered between New Delhi and Beijing following clashes between Chinese and Indian troops along their disputed Himalayan border in 2020.
Wang Xiaojian, spokesperson for Chinese Embassy in India, said that Beijing “firmly supports Chinese enterprises in safeguarding their legitimate rights and interests”.
“The frequent investigations by the Indian side into Chinese enterprises not only disrupt the enterprises’ normal business activities and damage the goodwill of the enterprises, but also impedes the improvement of the business environment in India and chills the confidence and willingness of market entities from other countries, including Chinese enterprises, to invest and operate in India,” he said.
Investigations into Chinese handset makers began in December, when local media reported that officials had raided Xiaomi, as well as Oppo and its OnePlus brand, on suspicion of tax evasion. The companies said they would cooperate with authorities.
The same month, anti-smuggling officials targeted offices of Bharat FIH – an Indian unit of Taiwan’s Foxconn – and Dixon Technologies (India), both of which are contract manufacturers for Xiaomi. It is unclear what they were looking for.
New Delhi has targeted Chinese business in other areas as well. It has barred Chinese telecom equipment makers Huawei Technologies and ZTE from participating in 5G trials and banned more than 200 Chinese apps, including the hugely popular TikTok short-video platform, citing security concerns.