Chinese visa for Indian Citizen

Hello, my friend is an Indian citizen who has a permanent regidency in Tokyo and he came to the Chinese visa consultate office in Tokyo today.
However the office didn't accept his application and introduced several travel agents in Japan...
Is it really not possible to apply directly at embassy?

He is just coming to Shanghai for transit and his flight arrives at Pudong and leaves from Hongqiao. He has valid passport/Regidency certification in Japan/flight tickets/relevant documents ready.