The popular video-sharing app TikTok on a smartphone. The video sharing format is driving up profits at parent company ByteDance. Credit: AFP/photo.

TikTok promoter ByteDance has been facing the heat from Indian authorities ever since the border clash between the Chinese and Indian forces last year. In the latest instance, the Chinese internet giant has alleged that its accounts have been frozen and told an Indian court that New Delhi’s latest action amounts to harassment and was done illegally, media reports said.

Indian tax sleuths two weeks ago ordered HSBC and Citibank in Mumbai to freeze bank accounts of ByteDance India as part of its investigation into the Chinese firm’s financial dealings. The sleuths are investigating whether there was any evasion of taxes related to online advertising and other financial dealings between ByteDance India and its parent entity in Singapore, TikTok Pte Ltd. ByteDance has challenged the account freeze in a Mumbai court.

ByteDance India’s employees have reportedly not been paid their March salaries due to the account freeze. The company currently has 1,335 employees, including outsourced personnel. In January, ByteDance had reduced its workforce, after India decided to continue with the ban on TikTok.

India had banned the short-duration video streaming app on June 29 last year along with many other Chinese-promoted apps in retaliation to border clashes. New Delhi has so far blocked over 200 such apps claiming that they engaged in activities that posed threats to “national security and defense of India.” The government had asked these companies about the data being collected, and how it was used. In January, India reiterated that the ban will continue as it was not satisfied with their response.

Prior to the ban, India was the biggest international market for TikTok, with over 200 million monthly active users and its appeal cut across regional, language and class barriers. The app had around 200,000 influencers and music companies were using the platform in multiple ways, from creating dance challenges to roping in A-list influencers to star in music videos for other platforms. Big brands were also tapping TikTok’s popularity to reach small towns and villages.

The Chinese government had earlier said that the ban on TikTok and other apps amounted to the violation of the World Trade Organization’s fair rules of business and will damage bilateral cooperation between the two countries.

Following the big void left behind by TikTok, home-grown apps like Chingari, Roposo, Mitron, and other have been witnessing a spike in downloads. Big tech companies like Facebook-owned Instagram and Google are also eyeing this space. Shortly after the ban, Instagram had brought its own short-duration video platform Reels to India and last September, Google chose to launch YouTube Shorts first in India, with plans to expand globally from there.