Vivo Money Laundering Case: Delhi HC Upholds ED custody of Chinese National

The Delhi High Court has refused to intervene with a trial court court sending a Chinese national Guangwen, also known as Andrew Kuang, in three-day Enforcement Directorate (ED) custody regarding a money laundering case against Chinese smartphone manufacturer Vivo.

A bench of Justice Swarana Kanta Sharma rejected a petition by Kuang, who is an office bearer of Vivo Mobile India. He had challenged the trial court’s decision for remand. The court noted that according to the grounds of arrest and the remand application, the petitioner, described as “one of the main conspirators,” was involved in the establishment of companies across the country to acquire and divert proceeds of crime.

“Ultimately, the investigating officer had concluded (in grounds of arrest) that the present petitioner was the prime conspirator of the formation of these companies through which the acquisition of proceeds of crime had taken place and which, after layering and integration, had been siphoned off by Vivo India,” the order reads.

The court found no flaws in the remand order issued on October 10, considering compliance with the provisions of Section 19 of the Prevention of Money Laundering Act (PMLA) and Section 45 of PMLA. Consequently, the court dismissed the petition along with the pending application.

On Friday, the trial court extended the petitioner’s custody with the ED for an additional three days in the case.

The petitioner, apprehended on October 10, had argued in the high court that his arrest was carried out in a malicious manner and contrary to the mandates of the Prevention of Money Laundering Act (PMLA), asserting that no case had been made against him.

The court rejected these objections, stating that the remand application explicitly mentioned that, based on the investigation and collected material, the petitioner was deemed “guilty” of money laundering. Therefore, written grounds of arrest were also provided to him.

On October 10, the trial court granted three-day ED custody to four individuals, including the petitioner, in the case. The ED had conducted raids on the company and its associated individuals in July of the previous year, alleging the dismantling of a major money laundering scheme involving Chinese nationals and multiple Indian companies. The ED had further alleged that Vivo had illegally transferred a substantial Rs 62,476 crore to China to evade taxes in India.