Green line glitch solution turns into a tax headache for OnePlus, ETCFO
OnePlus is facing tax demand for its warranty programme offering free screen replacement in case users experience green lines on displays of its smartphones, even as the Chinese firm’s sales and profit declined in 2024-25.
In its latest regulatory filings with the Registrar of Companies (RoC), OnePlus Technology India said goods and services tax (GST) officials have conducted inquiries, searches and inspections into its ‘Green Line Worry Free Solution’ for FY24 and FY25.
This is a lifetime warranty scheme offering free display replacements for devices affected by a green line on screens – an issue that went viral as a major tech glitch in Android smartphones of many brands globally since 2022-23. The glitch has impacted some handsets using Amoled display, often post a software update.
GST authorities have raised a tax demand of ₹93 crore for the Greenline warranty, against which OnePlus has deposited ₹10 crore under protest. “The management has been legally advised by a senior counsel that the company has a strong defence against this demand and possibility of any liability arising on the company is low,” OnePlus said in the filing.
It said it has not accrued any provision against the same.
The RoC filing does not specify on what grounds the GST demand has been raised.
“We are working closely with relevant officials on this matter and remain fully confident in a favourable outcome that continues to prioritize our customers’ experience,” a OnePlus India spokesperson said.
OnePlus, which competes in premium smartphones with Apple, Samsung, Vivo and Oppo, is the only brand in the industry offering lifetime display warranty against green line, the person said. According to the company’s website, the free-of-cost policy is applicable to all OnePlus devices sold through authorised channels.
Revenue, Profit Slide
For 2024-25, OnePlus India’s revenue fell 13% year-on-year to ₹12,983 crore, while its net profit slumped to ₹16 crore from ₹230 crore. The company did not attribute any reason for the fall in its RoC filing.
The company spokesperson said the FY25 performance “reflects a deliberate and strategic pivot to future-proof” the business. “While we’ve navigated short-term shifts in sales and profit, these were driven by essential investments in our systems, compliance, and infrastructure-foundational steps that ensure long-term, sustainable growth,” the person told ET.
The RoC filings also revealed that its auditors made some adverse comments on internal control over financial reporting by the company and whether such controls were operating effectively as of March 2025.
The spokesperson said OnePlus has proactively addressed the auditors’ observations through comprehensive remedial measures and implementation of financial controls.
Regulatory Disconnect
Experts said OnePlus faces a regulatory disconnect.
Mohit Yadav, founder at business intelligence firm AltInfo, noted that OnePlus auditors disclaimed opinion on internal controls with lack of audit trails, yet the company recorded zero provision against the GST demand.
These raise questions about governance oversight, especially given the mid-year ERP migration that auditors noted was still establishing ‘appropriate controls’ as of March 2025, he said.
Incidentally, OnePlus said in the RoC filing it has received many other show-cause and scrutiny notices from GST authorities, demanding an aggregate amount of almost ₹280 crore, against which the company has filed its response and paid ₹1.85 crore under protest.>
