The Tamil Nadu Government has asked Nokia to pay ₹2,400 crore as value-added tax, stating that handsets made at its Sriperumbudur plant near Chennai were also sold in India. The company has filed a writ petition in the Madras High Court against the claim.

Nokia is already embroiled in a ₹21,000-crore tax case with the Income-Tax Department for allegedly violating withholding tax norms since 2006 while making royalty payments to its parent company in Finland.

In a statement, Nokia said the Tamil Nadu tax department has moved to assess sales tax on the export of devices from the company’s Chennai facility.

“Nokia considers the claim to be completely without merit and counter to domestic tax laws. In India, exports are by law exempt from tax, and Nokia has proved consistently that devices produced in Chennai are exported,” said the statement.

The company has been regularly assessed and audited by tax authorities since 2006, without incident, the statement said.

The Tamil Nadu tax department’s claim that devices manufactured at the Chennai plant were not exported and were instead sold in India “has no basis in reality whatsoever; it could easily be rebuffed by a check of documentation provided to various governmental departments, including Customs,” the statement added.

Sources said that the tax notice was issued by the State tax department two weeks ago. It pertains to three financial years, beginning 2009-10.

Nokia has invested over $300 million in its 210-acre plant in Sriperumbudur, which is located on the Chennai-Bangalore National Highway.

Producing over 500 million units in seven years, the plant is its largest. It employs 8,000 people, half of them women.

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