China's largest electric vehicle (EV) maker BYD faces an ongoing probe over allegations in India that the automaker paid too little tax on imported parts for cars it assembles and sells in the country, citing two sources privy to the development news agency Reuters said.
According to the report, one of the sources said that the Directorate of Revenue Intelligence (DRI) has alleged that Chinese EV maker, whose expansion plans have been hit by fractious relations between New Delhi and Beijing, underpaid tax of Rs 73 crore ($9 million). Although BYD has deposited this sum after the DRI's preliminary findings, the source mentioned that the investigation is ongoing and could lead to additional tax charges and penalties.
The DRI is yet to issue a final notice to BYD, which can challenge the findings.
BYD in India and China did not reply to several requests from Reuters seeking comment. The finance ministry also did not reply to an email and WhatsApp message seeking comment from the news agency.
Meanwhile, the Centre recently rejected a $1 billion investment proposal of BYD. Sources told PTI that the proposal was submitted to the commerce and industry ministry which was circulated for necessary scrutiny and approval from the ministry of heavy industries, the ministry of external affairs and the home ministry. It was discussed and decided not to approve the proposal, they said.
India received $2.5 billion FDI equity from China from April 2000 to March 2023.
BYD is currently a technology partner to MEIL's Olektra. MG Motor, a British brand owned by China's largest automaker SAIC Motor Corp, has been awaiting government approval to raise funds from its parent, according to sources to the news agency. The automaker has been looking to raise capital for some time now to fund its expansion. With little success so far, it has now started looking for other options to raise the required capital.
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