ByteDance Plea Against India's Freeze on Bank Account Dismissed by Mumbai High Court

An Indian court on Tuesday dealt a blow to China’s ByteDance by dismissing its plea to unblock its bank accounts which have been frozen by federal authorities investigating alleged tax evasion.

An Indian tax intelligence agency in mid-March ordered HSBC and Citibank in Mumbai to freeze accounts of ByteDance India as it probed some of the firm’s financial dealings.

ByteDance challenged the move in court saying the freeze amounts to harassment and was done illegally.

After a government counsel said ByteDance owed the authorities about Rs. 79 crores, the High Court in Mumbai said the company will need to keep that amount blocked in a state-run bank.

That “account will be frozen,” the two-judge bench said.

ByteDance in January reduced its Indian workforce after New Delhi maintained a ban on its popular video app TikTok, imposed last year after a border clash between India and China. Beijing has repeatedly criticised India over that ban and those of other Chinese apps.

None of ByteDance India’s employees have been paid their March salaries due to the account freeze, said two people familiar with the matter. The company told the court it has a workforce of 1,335, including outsourced personnel.

In the 209-page court filing lodged on March 25, ByteDance told the High Court in Mumbai the authorities acted against the company without any material evidence and gave no prior notice, as required by Indian law, before such “drastic action”.

Blocking accounts “during the process of investigation amounts (to) applying undue coercion,” ByteDance argued. It is “intended, improperly, to harass the petitioner.”

© Thomson Reuters 2021
 

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