India tightening oversight of foreign companies and their imports - government ordered Samsung to pay unpaid taxes and penalty.

 India government ordered Samsung and it's management to pay 601 million dollars (the amount consistng of unpaid taxes and penalty) in back taxes and penalties.This action of the government is for dodging tariffs on import of telecom equipments.The demanded amount represents major part of last year's net profit of the company.In the last year the Samsung in India had reported a net profits of 955 million dollars.The company is engaged in and shows a strong presence in the area of smartphone business and consumer electronics business.However legal remedies are available to the company against the government order demanding tax and penalty amount by way of challenging it in a court or tribunal.

In related to import of transmission components used in mobile towers the company had received a warning notice in 2023 for misclassifying imports to evade tariffs of 10% or 20%. It was reported that the imported items were sold to telecom services provider Reliance Jio.

Meanwhile Samsung company asked Indian tax authorities to close the scrutiny process against the company saying the imported components did not attract tariffs and tax officials had known it's classification practice for years.

It was reported in The Economics Times that in an order  dated January 8, 2025 the Customs Authorities of India disagreed with the stand taken by the company. According to Commissioner of Customs Authority Samsung violated Indian laws and knowingly and intentionally submitted false documents before the Customs Authorities for clearance .In investigation it was found that the company transgressd all business ethics and industry practices or standards with profit motive by defrauding the public The company's seven Indian executives including Samsung General Manager for indirect taxes also face fines/penalty,the order showed.The Indian authorities found that form 2018 to 2021 Samsung made omissions in paying dues on import of telecom components from Korea and Vietnam worth 784 million dollars .

The Samsung company said in their statement that the present issue needs interpretation of classification of goods by Customs in the light of Indian laws hence they are seeking legal options to defend the case in order to protect their legal Main arguments of the company is that the imported telecom components did not perform the functions of a transceiver(a device which transmits signals) and could be imported widout any dut as tariff exempt.Meanwhile as counter the Indian tax authorities cited several letters from the Samsung company to the Indian company describing the component as a transceiver.