Hero Electric under DRI lens for evading customs duty worth Rs 330 crore

Hero Electric reportedly ordered fully assembled vehicles into the country but later disintegrated them and sent them to different ports across the country to evade tax

Hero Electric is under the lens of the Department of Revenue Intelligence (DRI) for allegedly evading customs duty worth Rs 330 crore. According to a CNBC TV18 report by, the company imported fully assembled e-scooters and declared them as automobile parts. The government has stopped providing subsidies to the company under the FAME scheme. 

 

The DRI in December 2020 issued a show cause notice to the company for evading tax. The company imported e-scooters and e-bikes between 2009 and 2014 and later between 2017 and 2019. 

 

Hero Electric has paid no fines or duties, the report added. 

 

The show cause notice says that the company committed "fraud intentionally" after "proper planning." It added that the DRI would like to recover the company's dues worth Rs 330 crore.

 

According to the report, the company ordered fully assembled vehicles into the country but later disintegrated them and sent them to different ports across the country to evade tax. 

 

"All the major sub-assemblies of the e-scooters/e-bikes, such as motors, controller, battery, frame, charger and DC-DC converter, were found to have been imported. This established that e-scooters/e-bikes had been imported in CKD condition. More than 90 per cent of the parts of e-scooters/e-bikes as per the bill of material were being imported and only a few minor parts such as clamps, nuts etc. had been procured locally," an official told Economic Times (ET). 

 

Hero Electric, in its response, said that they have been granted a stay by the court and are cooperating with the DRI appropriately.