(This story initially appeared on July 9, 2021) New Delhi officials: Directorate of Income Income (DRI) conducted “search” in the South Korean company office Samsung Electronics for allegations of duty avoidance, said people were aware of the problem.
“The search began at Samsung Delhi and Mumbai offices on Wednesday,” one of the people told ET with anonymous terms on Thursday.
“We haven’t heard anything about the findings of Dri.” Other people said DRI officials had come up with questions about importing network equipment.
“Because of the company’s network operations, especially in Mumbai, officials from visiting Mumbai office first.
And because Gurgaon is a company RHQ (regional headquarters), they come with questions in the office too,” other people said, who also did not want to be identified.
The third person who realized the detail said that officials saw documents related to the import provided by Samsung.
“The necessary steps will be taken to ascertain whether Customs avoidance has occurred and if so, whether it is Malaafide,” said the person, asked not to be named.
Samsung Electronics refuses to comment on ET questions.
Exclusive 4G equipment provider for Reliance Jio Infocomm, Samsung Electronics is the largest 4G vendor in India in terms of volume.
It enjoys the task of zero on the import of telecommunications products from its manufacturing base in their home countries and in Vietnam through the route of free trade agreements (FTA), as opposed to people such as Ericsson and Nokia Europe and China Huawei and ZTE who pay 20% tasks.
“The government may have received Intel that the equipment is truly made in non-FTA countries and is directed through South Korea or Vietnam with the addition of low values ​​in the geography,” an industrial expert said, requested anonymity.
“This makes the case to be questioned by the authorities because then imported equipment that does not follow the mandate of the addition of local values ​​is responsible for paying duties.” In October 2018, the government has doubled import duties to 20% in several types of network equipment including an Ethernet switch, IP radio, base station, media gateway, optical transportation equipment, MIMO / 4G LTE teeth, Packet Gateway, Transportation Node Packet and Optical Transport Products or switch.
It also collects 10% customs for products such as print circuit boards.
Most import network networks from South Korean suppliers enjoy customs free status under the free trade pact that exists between India and South Korea, called a comprehensive economic partnership agreement (CEPA), which was updated in July 2018.
Then Telecommunications Minister Manoj Sinha and Korean partners The south is the signing of a memorandum of understanding which aims to improve cooperation between the two countries to develop, modernize and expand the telecommunications services and the next generation of wireless networks such as 5G.
Radio and cellular radio communication teeth are excluded from import duties under the CEPA.