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Unique: ByteDance says India’s freeze on financial institution accounts is harassment 



© Reuters. FILE PHOTO: FILE PHOTO: ByteDance brand is seen on this illustration

By Abhirup Roy and Aditya Kalra

MUMBAI (Reuters) – China’s ByteDance has informed an Indian courtroom {that a} authorities freeze on its financial institution accounts in a probe of doable tax evasion quantities to harassment and was performed illegally, in line with a submitting seen by Reuters.

ByteDance in January diminished its Indian workforce after New Delhi maintained a ban on its widespread video app TikTok, imposed final 12 months after a border conflict between India and China. Beijing has repeatedly criticised India over that ban and people of different Chinese language apps.

An Indian tax intelligence unit in mid-March ordered HSBC and Citibank in Mumbai to freeze financial institution accounts of ByteDance India because it probed a few of the unit’s monetary dealings. ByteDance has challenged the freeze on the 4 accounts in a Mumbai courtroom.

None of ByteDance India’s staff have been paid their March salaries as a result of account freeze, stated two folks aware of the matter. The corporate informed the courtroom it has a workforce of 1,335, together with outsourced personnel.

Within the 209-page courtroom submitting lodged on March 25, ByteDance informed the Excessive Courtroom in Mumbai the authorities acted in opposition to the corporate with none materials proof and gave no prior discover, as required by Indian legislation, earlier than such “drastic motion”.

Blocking accounts “in the course of the technique of investigation quantities (to) making use of undue coercion,” ByteDance argued. It’s “supposed, improperly, to harass the petitioner.”

India’s Directorate Normal of Items & Providers Tax Intelligence, and the finance ministry which oversees it, didn’t instantly reply to requests for remark over the weekend.

The main points of the tax investigation haven’t beforehand been reported. The tax company informed ByteDance final 12 months it had causes to imagine the corporate suppressed sure transactions and claimed extreme tax credit, the submitting exhibits.

ByteDance declined to touch upon its courtroom submitting however informed Reuters on Tuesday it disagrees with the choice of the tax authority. HSBC declined to remark, whereas Citibank didn’t reply.

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The courtroom declined to grant ByteDance quick aid in a short listening to on Wednesday. The subsequent listening to is scheduled for Tuesday.

The investigation centres on potential evasion of taxes associated to internet advertising and different monetary dealings between ByteDance India and its dad or mum entity in Singapore, TikTok Pte Ltd. TikTok didn’t reply to an e-mail in search of remark.

ByteDance informed the courtroom its India workforce contains 800 folks working in its “belief and security” workforce that helps actions like content material moderation abroad.

The corporate has “sturdy enterprise plans in India and isn’t considering winding up,” it stated, urging the courtroom to raise the freeze on the accounts.

The tax company began investigating the corporate in July. It inspected paperwork on the firm’s workplace and summoned and questioned no less than three executives, the submitting says. Authorities additionally requested ByteDance to submit paperwork, together with invoices and agreements signed with some shoppers.

ByteDance representatives “appeared a number of instances” earlier than tax officers and offered paperwork, the submitting says.

TikTok, one in all India’s hottest video apps earlier than it was banned, has confronted scrutiny around the globe.

Below then-President Donald Trump, the US alleged the app posed nationwide safety considerations. The brand new administration of Joe Biden has paused a authorities lawsuit that might have resulted in a de facto ban on TikTok’s use there.





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