The Delhi Court on Friday asked the Enforcement Directorate to address mobile phone manufacturer Vivo India’s concerns about its frozen bank accounts, PTI reported.

The court was hearing a plea filed by challenging the central agency’s decision to freeze its accounts.

On Thursday, the Enforcement Directorate froze Vivo’s bank accounts after alleging that the company had transferred Rs 62,476 crore to China to evade tax in India.

In a statement, the central agency said the amount is almost 50% of Vivo India’s total sales of Rs 1,25,185 crore and claimed that it was remitted to Beijing to fraudulently show that the smartphone manufacturer had incurred losses.

On Friday, Vivo, in its petition, said that it needs to make monthly payments of around Rs 2,826 crore “towards statutory dues, salaries, rent, monies for daily business operations”, The Indian Express reported.

Senior Advocates Sidharth Luthra and Siddharth Aggarwal, appearing for Vivo, said that the company will not be able to pay its employees if the ban accounts remain frozen, PTI reported. There is no factual, foundational basis behind the search operation and that the freezing of the bank accounts amounted to the petitioner’s “civil death”, they added.

The court asked Advocate Zoheb Hossain, who represented the Enforcement Directorate, to get instructions from the agency to provide relief to Vivo.

Hossain said that a search operation will be conducted in the day after which the Enforcement Directorate will send material to the adjudicating authority. Vivo’s petition is premature, he added.

Meanwhile, Vivo has also accused the Enforcement Directorate of undertaking a “roving and fishing enquiry” and that it has made “various attempts to disrupt” its business, The Indian Express reported.

A fishing inquiry refers to asking questions that are not connected to the subject matter of a case.

The case will be heard on July 13.

Case against Vivo

On Wednesday, the Enforcement Directorate conducted searches at 48 locations belonging to Vivo India and its 23 associated companies based on a complaint by the Ministry of Corporate Affairs.

Enforcement Directorate’s case report alleged that Grand Prospect International Communication Private Limited, a company associated with Vivo India, and its shareholders had used forged identification documents and false addresses when the firm was incorporated in December 2014.

The company was established by Chinese citizens Zhengshen Ou, Bin Lou and Zhang Jie with the help of Indian Chartered Accountant Nitin Garg.

All the Chinese citizens left India between 2018 and 2021.

The Enforcement Directorate has said that Bin Lou, the former director of Vivo, is also the director of Grand Prospect International Communication. The agency added that he had incorporated 18 companies in India between 2014 and 2015. Four other companies were incorporated by another Chinese citizen Zhixin Wei.

The 22 companies along with Grand Prospect International Communication had transferred the funds to Vivo India, which then remitted it to China, the Enforcement Directorate alleged.