The Centre on Friday informed the parliament that Chinese handset makers, such as Xiaomi, Realme, Oppo, Vivo, and Oneplus, have evaded GST of Rs 1,108.98 crore and custom duties of Rs 7,966.09 crore in the last five years till 2023-24.
In a reply to an unstarred question in the Rajya Sabha, Rajeev Chandrasekhar, minister of state for electronics and IT, said the data is between 2017-18 and 2023-24 (up to July 1). Show cause notices have been issued to these companies and investigation has been initiated, he said in his reply to questions raised by Narain Dass Gupta, MP, Rajya Sabha.
The companies are being persuaded to deposit the tax amount/ interest/ penalty as applicable, Chandrasekhar added.
Giving the breakup, the minister said Xiaomi has evaded customs duty of Rs 89 lakh, which it paid along with interest of Rs 31,77,721 and penalty of Rs 13,30,143, and its file was closed.
In 2019-20, Xiaomi evaded customs duty of Rs 653.02 crore of which it has only paid Rs 46 lakh. Chandrasekhar said the government has issued a show cause notice to the company on the shortfall.
Along the same lines, in 2020-21, Oppo Mobile India evaded customs duty of Rs 4,389 crore, of which it paid only Rs 450 crore.
Vivo India evaded customs duty of Rs 2,217 crore during the same year of which it has paid only Rs 72 crore. In total, Vivo , has been accused of evading Rs 2,875 crore in customs duties in FY21 and FY23, where the government has recovered just Rs 117 crore, the minister said.
In terms of GST, the minister said the company has evaded Rs 48.25 crore, with part of the evasion still being processed. So far, the government has recovered Rs 51.25 crore from the company for the same.
Lenovo, which also operates the Motorola brand in India, has also been charged with GST evasion to the tune of Rs 42.36 crore, although no recoveries were recorded yet.
The minister also said the major Chinese mobile handset brands had a cumulative turnover of Rs 1.5 lakh crore in FY2022 in India, employing over 75,000 people directly for manufacturing, and another 80,000 in sales and operations.
Chandrasekhar informed parliament that the major Chinese brands which are operating in India include Oppo, Vivo, Xiaomi, Transsion, Realme and Oneplus. Transsion operates three brands in India – Itel, Tecno and Infinix. These companies manufacture mobile handsets either by themselves or through contract manufacturers.
“Primarily, these Chinese companies have setup their own manufacturing units; however, they work with contract manufacturers like Bharat FIH Limited and DBG Technology (India) Private Ltd also which have set up electronics manufacturing services (EMS) operations in India. The distribution of mobile handsets is mainly handled by Indian companies, however, some of the Chinese companies like Oppo and Vivo have some Chinese distributors also,” Chandrasekhar said.
“Their cumulative turnover in 2021-22 was estimated to be Rs 1.5-lakh crore in India. The total direct employment generated by them in their manufacturing operations is more than 75,000. They also have sales and operational workforce of around 80,000 workers,” he further said.
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