Samsung deposits ₹300 crore with DRI in alleged duty evasion case

Samsung Electronics has paid ₹300 crore as customs duty to Directorate of Revenue Intelligence (DRI) following an investigation by the agency into alleged duty evasion of import of 4G radio equipment by the company.

The DRI has charged the company for wrongly classifying the equipment under zero-duty category and duty evasion to the tune of ₹500 crore.

“The company made the payment Wednesday (August 18) and the balance will be paid in due course of the investigation,” one of the sources said, adding that the company was the only one importing equipment under the category head. Sources said that the payment was the largest such made by a company in a single day, adding that the partial payment by Samsung was already credited to the government account.

Samsung Electronics did not comment on the development as of Thursday press time.

Remote radio head equipment is used for transmission and conversion of 4G airwaves. Samsung is the largest 4G vendor in India in terms of volume.

The Directorate of Revenue Intelligence had carried out searches at the Delhi and Mumbai offices of the South Korean firm early last month, over suspected evasion of duty on import of network equipment.
Initially the investigations were to unearth whether duty evasion was done by through the free-trade agreement (FTA) by re-routing network gear imports from Korea or Vietnam, thus flouting local value addition norms.

However, it was subsequently found that the company was importing the equipment claiming an exemption notification which was not applicable to the equipment, and hence was liable to pay the duty at 20%.

Sources said that other network providers who were importing the same equipment were paying the duty at 20%, and therefore the company has paid up the duties that were sought by the agencies.