Free Press Journal

Nokia moves SC against HC order for “simple undertaking” on taxes

FOLLOW US:

NEW DELHI – Nokia India Pvt Ltd has moved the Supreme Court against the Delhi High Court order asking the Indian arm of the Finnish mobile phone maker to furnish a “simple undertaking” to abide by tax demands of the authority and the conditions imposed by the high court in its Dec 12 judgement, a lawyer told Cogencis.

The high court had last week passed the order on a plea by the income tax department, which had earlier said that it might demand more than 200 bln rupees from Nokia India and Nokia Corp as taxes.

The order had come after the tax department said it was not satisfied by an earlier undertaking by Nokia Corp having too many clauses.


The appeal has been filed to ensure immediate and smooth transfer of Nokia India’s assets and the Chennai plant to software giant Microsoft Corp as part of the $7.2 bln global deal between Microsoft Corp and Nokia Corp, the lawyer said.

Nokia in its appeal has said an unconditional undertaking would amount to be a pre-condition for sale of Indian assets to Microsoft and may lead to closure of the Chennai plant, the lawyer added.

The Delhi high Court had while asking for a simple undertaking from Nokia rejected the income tax department’s plea for modification of its Dec 12 order and also refused to direct the mobile phone maker to deposit 35 bln rupees in an escrow account immediately.

The high court, however, observed that Nokia had added unnecessary clauses in its undertaking that it would abide by Indian tax laws and asked it to furnish a “simple” undertaking that the Dec 12 order was acceptable to it.

Following months of dispute between the tax department and Nokia, the high court had on Dec 12 allowed the latter to sell its India assets to Microsoft under the $7.2-bln global deal on condition that the company would deposit 22.5 bln rupees in an escrow account after it receives the sum for India assets from Microsoft.