Two sources reported on Friday that an Indian court had put on hold a federal enforcement agency''s decision to confiscate $725 million (roughly Rs. 5,570 crore) from China''s central bank accounts.
Last week, the Enforcement Directorate seized the bank assets of Xiaomi Technology India Private Limited, claiming that the company had unlawfully remitted funds to three international-based businesses, including one Xiaomi group entity, "in the guise of royalty payments."
Xiaomi had denied any wrongdoing, claiming that its "royalty payments and statements to the bank are all legit and fair." In the early stages of the trial, the Indian financial crime tribunal had filed a lawsuit against the Indian financial crime agency.
On Thursday, a judge took a hold on the Enforcement Directorate''s decision, according to two sources, who declined to be identified due to their absence of authorization to speak to the media.
Xiaomi and the Enforcement Directorate did not immediately respond to requests for comments. The written court order is not yet public.
According to one source, the relief was granted on the condition that Xiaomi will inform Indian authorities of fund transfers such as royalty payments.
According to the Indian Court''s website, the case will be next heard on May 12.
According to Counterpoint Research, Xiaomi was India''s leading smartphone seller in 2021.
According to Reuters, Xiaomi''s former India head, Manu Kumar Jain, was summoned and questioned as part of the directorate''s investigation.
Many Chinese businesses have struggled to work in India due to political disagreements since a border dispute in 2020. India has cited security concerns in banning more than 300 Chinese apps since then, including popular ones such as TikTok, and increased restrictions for Chinese firms investing in India.
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