According to a document seen by Reuters, China’s ByteDance told Indian courts that the government’s freezing of its bank accounts to investigate possible tax evasion constituted harassment and was carried out illegally.

After New Delhi maintained a ban on its popular video app TikTok, ByteDance reduced India’s workforce in January this year. The ban was implemented last year after a border conflict between India and China. Beijing has repeatedly criticized India for the ban and other Chinese app bans.

In mid-March, the Indian tax intelligence agency ordered HSBC and Citibank in Mumbai to freeze the bank accounts of ByteDance India because the agency conducted an investigation into some of the department’s financial transactions. ByteDance has challenged the freezing of four accounts in a Mumbai court.

Two people familiar with the matter said that none of the employees of ByteDance India received their March salary due to account freezes. The company told the court that it has 1,335 employees, including outsourced personnel.

In a 209-page court document filed on March 25, ByteDance told the Mumbai High Court that the authorities took action against the company without any significant evidence before taking any “serious action” and did not follow the requirements of Indian law. Give advance notice.

ByteDance argued that “the account was frozen during the investigation to impose undue duress”. This is “improper intent to harass the petitioner”.

The General Administration of Goods and Services Tax Intelligence and the Ministry of Finance, which oversees it, did not immediately respond to requests for comment over the weekend.

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The details of the tax investigation have not been previously reported. The document shows that the tax agency told ByteDance last year that it has reason to believe that the company suppressed certain transactions and claimed excessive tax credits.

ByteDance declined to comment on its court documents, but told Reuters on Tuesday that it did not agree with the tax authorities’ decision. HSBC declined to comment, while Citibank did not respond.

Advertising, other transactions are carefully reviewed

The court refused to grant ByteDance immediate relief in a brief hearing on Wednesday. The next hearing is scheduled for Tuesday.

The investigation focused on potential tax evasion related to online advertising and other financial transactions between ByteDance India and its parent company TikTok Pte in Singapore. TikTok did not respond to emails seeking comment.

ByteDance said in court that 800 of its staff in India work in its “Trust and Security” team, which supports activities such as overseas content reviews.

It said that the company “has a sound business plan in India and has not considered winding it up” and urged the court to lift the freezing of these accounts.

The tax agency began investigating the company in July. The filing said it checked the documents in the company’s office and called and questioned at least three executives. The authorities also required ByteDance to submit documents, including invoices and agreements signed with certain customers.

The filing says that ByteDance representatives “appeared repeatedly” in front of tax officials and provided documents.

TikTok, one of the most popular video apps in India before it was banned, has been censored globally.

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Under the leadership of then-President Donald Trump, the United States claimed that the application constituted a national security issue. Joe Biden’s new government has suspended a government lawsuit, which may result in a de facto prohibition of TikTok on TikTok.

Thomson Reuters 2021 ©


What is the best phone under Rs. Now there are 15,000 in India? We discussed it on the gadget 360 podcast Orbital. Later (from 27:54), we talked with Neil Pagedar and Pooja Shetty, the creators of OK Computer. Orbital is available for Apple Podcast, Google Podcast, Spotify and wherever you get a Podcast.