Mohit Goel, the founder of Ringing Bells, an Indian tech firm was arrested on Thursday afternoon in Uttar Pradesh on charges of fraud after a handset dealer accused the company of not refunding him for an unfulfilled. Goel will be produced in court later on Friday, said Rahul Srivastav, a police spokesman from the northern Indian state.
Goel and his company rose to prominence after the launch of “Freedom” smartphone, which was priced at 251 rupees ($3.77), attracting a strong appeal from customers. The company, however, attracted widespread scepticism and scrutiny from regulators even in India where cheap smartphones are big sellers.
The founder was arrested after a dealer said he had paid 3 million Indian rupees for an order of handsets but had received only a fraction of the order. He further said some of the phones received were defective, according to the police.
The dealer claimed that when he pursued Ringing Bells for a refund for the unfulfilled order, Mohit Goel and another executive at the mobile phone maker threatened to kill him and his family.
Ringing Bells failed to comment on the matter.