Vivo money laundering case: Delhi HC allows companies to operate bank accounts

New Delhi [India], August 17 (ANI): The Delhi High Court on Wednesday allowed a batch of petitions seeking de-freezing of their bank accounts and permission to operate. These petitions were moved in a money laundering case connected with Vivo Mobile India Private Limited.
Justice Yashwant Varma after hearing the submissions of the counsels for the petitioner and Enforcement Directorate (ED) granted relief to them subject to certain conditions to be followed by the petitioners including maintaining the amount in question in the bank account on the day of freezing.
The bench directed the ED to permit the petitioner within 48 hours to operate their bank accounts.
Today the bench directed It is further observed that the exercise which the Enforcement Directorate is required to undertake in terms of paragraph 6 of the directions given earlier extracted hereinabove shall be completed with expedition and preferably within a period of forty-eight (48) hours.
The Court had observed in the order of August 8, 2022, that it shall be open to the Directorate to duly verify that all the petitioners maintain balances as were standing to the credit of the respective accounts on the date of seizure and that those balances are retained and preserved at all times during the pendency of proceedings before the Adjudicating Authority. All the petitioners shall also furnish to the Enforcement Directorate all details of remittances that may be made from the concerned bank accounts every 48 hours.
The 12 companies have moved the High Court through advocate Rajiv Mohan seeking de-freezing of their bank accounts.
It was submitted before the bench that the petitioners' bank accounts were put on a debit freeze since July 6 this year by the ED in connection with a money laundering case connected with Vivo Mobiles.
The counsel submitted that due to the freezing of bank accounts the petitioner companies were not able to meet their expenses including rentals, salaries etc. In view of this, the Bank accounts should be allowed to operate.
It was also submitted that the other batch of petitions seeking the same relief was allowed by the court on August 8.
Earlier the High Court on July 13 this year had allowed Vivo Mobile to operate the bank account subject to furnishing a bank guarantee of Rs 950 crore. The company had challenged the freeze of its bank accounts by the Enforcement Directorate (ED).
According to the ED, Vivo India's nearly 23 associated firms such as Grand Prospect International Communication Pvt Ltd (GPICPL) transferred huge amounts to the firm and out of the total sale proceeds of Rs 1,25,185 crore, it remitted Rs 62,476 crore, almost 50 per cent of the turnover out of India, mainly to China.
"These companies are found to have transferred huge amounts of funds to Vivo India. Further, out of the total sale proceeds of Rs 1,25,185 crores, Vivo India remitted Rs 62,476 crores almost 50 per cent of the turnover out of India, mainly to China," the ED informed.
The ED said this after it carried out searches at 48 locations across the country belonging to Vivo Mobiles India Private Limited and its 23 associated companies such as GPICPL.
It further said GPICPL was registered on December 3, 2014, at the Registrar of Companies, Shimla, with registered addresses of Solan in Himachal Pradesh and Gandhi Nagar, Jammu.
The company was incorporated by Zhengshen Ou, Bin Lou and Zhang Jie with the help of Nitin Garg, a Chartered Accountant.
"Bin Lou left India on April 26, 2018. Zhengshen Ou and Zhang Jie left India in 2021."
PMLA Investigation by ED was initiated by recording an Enforcement Case Information Report (ECIR) on February 3 this year on the basis of a First Information Report (FIR) registered by Kalkaji police station under Delhi Police on December 5 last year against GPICPL and its Director, shareholders and certifying professionals on the basis of a complaint filed by Ministry of Corporate Affairs. (ANI)