Xiaomi challenges India tax authority over tariffs on royalties in closely watched case

NEW DELHI: Xiaomi has challenged an Indian tax ruling that said the company evaded $72 million in tariffs on royalty payments, according to legal documents, a dispute that the Chinese company and lawyers say is a test of the country’s legal framework for contract manufacturing.

Xiaomi, a major player in the Indian smartphone market, has for years had its contract manufacturers in the country import parts from China, pay customs duties and then assemble the devices.