Block on Xiaomi India’s Rs. 3700 crore deposits removed by court: Report

Xiaomi India has been subjected to intense scrutiny by the Indian government and has experienced numerous financial difficulties. Rs. 3,700 crore Fixed Deposit (FD) on the company’s bank account was blocked in February 2022 for a variety of reasons.

This revelation was first reported by Reuters in May, based on Xiaomi’s court filing. According to the report, the sum frozen by Indian tax inspectors was a result of the December raids on Xiaomi India headquarters for alleged income tax evasion.

The inquiry centred on charges that Xiaomi paid inflated prices for smartphones from its contract makers in India, allowing it to make a smaller profit by selling them to customers and avoiding corporate income taxes.

Now, according to the latest Reuters report, the Indian court has overturned the income tax department’s earlier block. The report’s sources were two people familiar with the judicial proceedings at the Karnataka state court.

This appears to be positive news for the company. We have yet to receive an official comment from both the IT department and Xiaomi. More information about the situation should be available in the coming days.