Ringing Bells ‘$4 Smartphone’ Founder Arrested on Fraud Allegations
Does the name ‘Ringing Bells’ ring any bells? The oddly-named company was responsible for stealing the limelight for a few weeks with its Freedom 251 smartphone, which was being sold to the customer for an astonishingly low $4 (₹251).
There were a number of things not quite right with this $4 smartphone. We had an article over why the $4 smartphone should not exist, and we have also talked about how the company requested a meager $7.4 Billion USD from the Indian government to deliver the phone which otherwise would have costed $55 to produce at the time. Needless to say, the other phone manufacturers raised as many eyebrows at the phone and its pricing as we did. After the smartphone’s several week stint in the media, it seemed like any further developments regarding it had dropped off the radar.
To give some closure to this story, the founder of Ringing Bells, Mr. Mohit Goel, has been arrested on allegations of forgery, criminal breach of trust, cheating, and criminal conspiracy. The company is accused of not refunding advance payments made towards distributorship of the company.
Ringing Bells was advanced a total of ₹30 Lakhs ($45,000) from one of its distributors in December 2015. Some goods were subsequently delivered, but these were found to be of improper quality. Delivery delays caused the distributor to demand a refund, and Ringing Bells eventually ended up returning part of the advance. However, at the end, a total of ₹16 Lakhs ($24,000) was kept pending.
A report from Reuters claims that Mohit Goel and another executive at the phone company threatened to kill the distributor and his family. However, reports from other reputable Indian media make no mention of this claim, and the police complaints filed against the accused are not related to Criminal Intimidation (making of death threats) which are covered separately under Section 506 of the Indian Penal Code.
Mohit Goel, in his defense to Indian media, insists that all was well. Of the 110 distributors of the company, “nearly 95%” had received full payments and the remaining 15 were also paid back nearly 60% of the amount. The balance amount was to be paid by the end of March. He alleges that the motive behind his implication in this case was a “conspiracy” to throw him out of the smartphone business.
Competitors would need a serious business model if they intended to put a heavy and intentional loss maker out of business. Furthermore, if the distributors are given their money back, and the customers were never charged, and the phones were procured at heavy losses, where does the money come in from and will the smartphones ever be delivered to a considerable extent? We hope the Indian judicial system is able to resolve this matter.
What are your thoughts on the Freedom 251 and this latest development? Let us know in the comments below!
Source: Hindustan Times