Xiaomi has denied rumors that it may relocate its operations from India to Pakistan after the Enforcement Directorate froze its assets worth $5,551.27 crore for allegedly breaching Foreign Exchange Management Act rules.
The Chinese mobile maker filed an appeal with the Karnataka high court on Friday, contesting the FEMA competent authority’s September 29 ruling, which approved the ED’s April 29 seizure order to freeze its assets.
According to South Asia Index, citing sources, the Chinese cellphone company may relocate its operations from India to Pakistan after its assets worth $676 million were blocked.
“This tweet is absolutely incorrect and without basis. Xiaomi entered India in 2014, and we began our Make in India journey in less than a year. 99% of our smartphones and 100% of our televisions are manufactured in India. We will take all necessary steps to safeguard our reputation from false and incorrect charges,” Xiaomi said on Twitter.
The Chinese mobile maker returned to the Karnataka high court on Friday, appealing the FEMA competent authority’s September 29 judgment, which approved the ED’s April 29 seizure order to freeze its assets. The central investigation agency has ordered the seizure of assets for allegedly breaking FEMA laws and transferring money to three firms outside India under the pretense of royalty.
The Chinese phone manufacturer contested the appeal ruling in its petition, claiming that a representative of a foreign bank was not permitted to testify at the hearing.
Xiaomi’s counsel stated that the case was maintainable since it also questioned the constitutionality of Section 37A of the FEMA related to a company’s assets kept outside India.
The high court earlier this year authorised the cellphone company to use the money for day-to-day operations but forbade it from using it to pay royalties.
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