Cell phone makers Xiaomi and Oppo can be fined Rs 1,000 crore for violating the regulation, the Earnings Tax division mentioned at the moment after searches throughout India final week.
The searches had been carried out on December 21 in Delhi and 11 states – Karnataka, Tamil Nadu, Assam, West Bengal, Andhra Pradesh, Madhya Pradesh, Gujarat, Maharashtra, Bihar, Rajasthan.
“The search motion has revealed that two main corporations have made remittance within the nature of royalty, to and on behalf of its group corporations positioned overseas, which aggregates to greater than Rs.5500 crore,” the tax division mentioned in an announcement at the moment.
“These corporations had not complied with the regulatory mandate prescribed underneath the Earnings-tax Act, 1961 for disclosure of transactions with related enterprises. Such lapse makes them answerable for penal motion underneath the Earnings-tax Act, 1961, the quantum of which may very well be within the vary of greater than Rs.1000 crore,” the assertion added.