DRI Sends Show Cause Notice To Samsung India Over Alleged Tax Evasion: Report

The DRI reportedly asked SIEL why it should not recover the Rs 1,728.47 crore along with interest for alleged customs duty evasion.

Samsung India Electronics (SIEL) has been issued a notice by the Directorate of Revenue Intelligence (DRI), said a report by The Economic Times on Thursday (January 12). The DRI reportedly asked the South Korean tech major why it should not recover the Rs 1,728.47 crore along with interest for alleged customs duty evasion.

The DRI, in the notice, also asked why a fine should not be imposed against the senior management of the company.

It is alleged that there has been misdeclaration and misclassification by Samsung India, of remote radio head (RRH), a networking device, to avail undue exemption of basic customs duty, the report noted. The DRI has also issued a show cause notice to PricewaterCoopers Pvt Ltd (PwC) that was hired by SIEL for the classification of the network equipment.

A local unit of South Korea's Samsung Electronics has allegedly evading import taxes worth Rs 1,728.47 crore by misclassifying a product. Earlier this week, the notice was issued by Nhava Sheva Customs, the report noted.

The ET report further noted that both SIEL and PwC have been given 30 days to reply to the notice.

Meanwhile, as per news agency Reuters, Samsung India Electronics, in its response, has said that it is reviewing a government notice related to a tax dispute.

To recall, India's revenue authorities are probing tax evasion to the tune of Rs 7,300 crore by Chinese handset makers companies Oppo, Vivo India and Xiaomi, finance minister Nirmala Sitharaman had told Rajya Sabha in August last year. According to an investigation by the Enforcement Directorate (ED), Vivo Mobiles India Pvt Ltd has remitted Rs 62,000 crore or about 50 per cent of the total sales, mainly to China and its controlled territories between July 2017-March 2021.