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Informist, Wednesday, Nov. 20, 2024

 

NEW DELHI – The Delhi High Court on Wednesday granted bail to Hari Om Rai, the managing director of Lava International Ltd., in a money-laundering case involving Vivo Mobile Communication Co. Ltd, China and its Indian group companies. The high court said the case has 48 accused persons, 527 witnesses and 80,000 pages of documents, which would mean that the trial was not expected to end anytime soon.

 

"...the trial is not expected to end anytime in the near future and the delay is not attributable to the accused, keeping the accused in custody by using Section 45 PMLA (Prevention of Money Laundering Act, 2002) as a tool for incarceration or as a shackle is not permissible," said the court. Liberty of an accused cannot be curtailed by Section 45 of the 2002 Act without taking all other germane considerations into account, it added.

 

The court said that Rai had been in custody since Oct. 10, 2023, and the trial was still at the stage of inspecting documents and charges were yet to be framed. Of the seven accused who have been arrested, the arrest of three of them was declared illegal by the trial court and the other three have already been released on bail.

 

The high court said Rai was not allowed to leave Delhi-National Capital Region without prior permission of the concerned court and surrender his passport. Further, it directed Rai to regularly appear before the concerned court during the pendency of the proceedings.

 

The Enforcement Directorate in a complaint had alleged that Vivo China along with others conspired to fraudulently set up Vivo group of companies in India without revealing their true beneficial ownership and carried out mis-declarations before government bodies. Vivo Mobile India Pvt. Ltd. and its state distribution companies concealed their Chinese ownership, said the complaint. Since the 2020 border clashes with China, there has been anti-China rhetoric and government actions against businesses based in the neighbouring country, including banning several Chinese mobile applications. 

 

Vivo India had remitted funds to the tune of INR 708.37 billion outside India, from total funds of INR 716.25 billion accumulated from the sale of goods between January 2015 and March 2021, the complaint said. Thus, Vivo China, through Vivo India, had created an elaborate network of companies under a corporate veil, it added. By creating the given meshed and pan-India structure, Vivo India has acquired proceeds of crime to the tune of INR 202.41 billion, the complaint said.

 

The probe agency alleged that Rai had invited Chinese nationals from Vivo China in 2013-2014 with the intent of enabling them to set up a web of companies in India by concealing true ownership. He provided them with logistical and ground support and helped them get a foothold in India by circumventing foreign direct investment norms, the complaint said. He also allegedly transferred money from Lava and his personal account to Labquest Engineering Pvt. Ltd., to help Vivo China set up a number of companies without disclosing that it was controlling these entities.  End

 

Reported by Surya Tripathi

Edited by Tanima Banerjee

 

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