While dismissing an appeal filed by the Income Tax Department, the Delhi High Court on has allowed Huawei CEO Xiongwei Li to travel abroad subject to depositing of an FDR of Rs. 5 crores.
A Single judge bench of Justice Anu Malhotra added that the condition so imposed will be forfeited on account of Xiongwei Li’s non-joining of the investigation and non-appear as and when directed by the Trial Court.
The Appeal filed by the Deputy Director of Income Tax challenged an order passed by the Trial Court dated August 29, 2022, which had quashed the LOC, issued at the request of the Income Tax Officer, against Xiongwei Li. The plea also sought a stay of the operation of the impugned order.
The Delhi High Court has observed that, though it is not considered appropriate by the Court to set aside the impugned order dated 29.8.2022 of the learned Trial Court which has set aside the LOC against the respondent in addition to the conditions imposed by the learned Trial Court to the effect that in case of resignation, retirement or cessations of employment etc. of the respondent company, M/s Huawei Telecommunications (India) Company Private Limited (HTICPL) shall withhold the severance pay/severance package and other incentives/emoluments payable to the respondent and the same shall not be released without permission of this Court to which effect an undertaking has been directed to be submitted of the company to be filed before the Trial Court under intimation to the petitioner which the respondent submits has already been so submitted copy of which has also been submitted before this Court, the appropriateness of the undertaking being in consonance with the order dated 29.8.2022 of the learned Trial Court is an aspect to be considered by the Trial Court.
The Court also directed that the respondent shall further submit an undertaking to the Trial Court that he shall continue to join the investigation as and when directed by the Investigating Officer through video conferencing and furthermore.
While permitting to travel out of India only subject to the respondent submitting an FDR to the tune of Rs.5 crores drawn on a nationalized Indian bank in the learned Trial Court which on deposit is to be renewed in an automatic renewal mode which on the failure of the respondent to join the investigation twice shall stand forfeited and which also on failure to appear before the Trial Court as and when directed by the Trial Court shall be forfeited.
“The directions qua the imposition of the conditions of deposit of an FDR of an amount of Rs.5 Crores drawn on a nationalized Indian Bank and forfeiture thereof on non-joining of the investigation and non-appearance as and when directed by the Trial Court have been imposed to take into account the eventuality of the alleged commission of an offence punishable under Section 276C(1)(i) of the of the Income Tax Act, 1969 read with Section 278B(1) of the Income Tax Act, 1969, if any, committed by the respondent”, the Court also noted.
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