Info-tech

Nokia gets a breather as court stays Rs 2,000-cr tax demand

S. Ronendra Singh New Delhi | Updated on March 12, 2018

The Income-Tax Department had served the demand notice to the Finnish mobile company for alleged evasion of taxes in its business transactions in the country.

Charge pertains to failure to deduct tax at source for royalty paid to parent

Nokia India on Thursday said that it has been granted an interim stay by the Delhi High Court on the Rs 2,000-crore demand notice served on it by the Income-Tax Department.

On March 21, the Department had asked the firm to submit the said amount in a week’s time.

“Nokia confirms it has received an order from Indian tax officials.

“Nokia reiterates its position that it is in full compliance with local laws as well as the bilaterally negotiated tax treaty between the Governments of India and Finland, and will defend itself vigorously,” the company said in a statement.

The company said it had filed a writ before the Delhi High Court last week, and on March 22, the court had issued a notice to the I-T Department to file its counter-affidavit, and it has granted interim stay of the entire tax demand raised against Nokia till further orders.

The I-T Department had served the demand notice to the Finnish mobile company for alleged evasion of taxes in its business transactions in the country.

The notice was issued by the Department after it completed its probe and had conducted a survey operation on the premises of the Chennai facility in January.

The tax evasion pertains to royalty payment made against supply of software by Nokia’s parent company which attracts a 10 per cent tax deduction at source.

The Department has analysed the company’s business statements since 2006.

Nokia remains willing “to cooperate fully with Indian tax authorities in accordance with all applicable laws,” the company said.

Nokia has invested over $330 million in the Chennai plant since setting up the factory in 2006.



>ronendrasingh.s@thehindu.co.in

Published on March 28, 2013

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