OPPO India Customs Duty Evasion: During the investigation of M/s Oppo Mobiles India Private Limited, a subsidiary of 'Oppo China' Guangdong Oppo Mobile Telecommunications Corporation Limited, popularly known as 'Oppo India' , the Directorate of Revenue Intelligence (DRI) collected about Rs 4,389 crore. Customs evasion is detected.
Oppo India has many brands in India
Oppo India is engaged in the business of manufacturing, assembling parts, retailing, and distributing of mobile handsets and accessories across India. Oppo India deals in various brands of mobile phones- Oppo, OnePlus and Realme.
Many incriminating evidence recovered during the investigation
During the investigation, the DRI searched the office premises of OPPO India and the residences of its key management staff. During this period, incriminating evidence was recovered indicating willful misrepresentation in the details of certain items imported by Oppo India for use in the manufacture of mobile phones.
Oppo wrongly took profit of Rs 2,981 crore
This wrong declaration resulted in wrongful availing of ineligible duty exemption benefit of Rs 2,981 crore by Oppo India. Among others, the senior management staff of Oppo India and domestic suppliers were questioned. He admitted in his voluntary statements that he had submitted false details to the Customs authorities at the time of import.
Companies in China paid 'royalty' and 'license fee'
The investigation also revealed that Oppo India had made provisions for transfer/payment of funds towards 'royalty' and 'license fee' to various MNCs based in China in exchange for use of proprietary technology/brand/IPR license etc.
OPPO India violates customs law
The 'Royalty' and 'License Duty' paid by Oppo India were not being added to the transaction value of the goods imported by them, which is in violation of Section 14 of the Customs Act, 1962. This should be read with Rule 10 of Customs Valuation (Determination of Value of Imported Goods), Rules 2007. An alleged fee evasion of Rs 1,408 crore was done on this account by M/s Oppo India.
Penalty proposed on Oppo India, its employees and Oppo China
Oppo India deposited Rs 450 crore as partial differential customs duty paid by it. After the completion of the investigation, a show cause notice was issued to Oppo India seeking an amount of Rs 4,389 crore. The notice also proposes suitable punishment on Oppo India, its employees and Oppo China under the provisions of the Customs Act, 1962.