The Supreme Court, on Friday, dealt Nokia a setback after dismissing the Finnish handset maker’s appeal challenging a Delhi High Court order regarding the transfer of the company’s assets to software giant Microsoft.
Nokia India, which is currently caught in a Rs. 21,000-crore tax dispute with the authorities, needs to transfer its India assets to software giant Microsoft as part of the impending acquisition.
The Delhi High Court had, last month, asked Nokia to give a ‘simple undertaking’ in addition to depositing Rs. 2,250 crore in an escrow account. This new condition, which the company refuses to agree to, would result in Nokia agreeing to an open-ended guarantee that the company would meet any future tax claims relating to the dispute.
These conditions must be first satisfied before Nokia can transfer its India assets to Microsoft. It had, therefore, appealed the Supreme Court last month in the hope that it would get relief and be able to transfer its assets in time for the acquisition.
This new SC ruling, however, will mean that Nokia may not be able to transfer its assets in time, putting the fate of its Chennai plant in jeopardy.
Nokia, in a statement, said that it was disappointed by Supreme Court’s decision.
“The decision means that the case now reverts to the February 5 Delhi High Court ruling on the asset transfer. The company strongly believes its offer to the Indian tax department is fair for all sides,” the statement said “Nokia will now consider its next steps,” the statement added.