The Income Tax Department has informed the Delhi High Court that Nokia India and Nokia Corporation owed it Rs.21,153 crore as total tax liability (existing and anticipated), including penalty during 2006-13.
The amount payable by Nokia has been arrived at by the I-T Department on the basis that the mobile manufacturing firm does not discharge its TDS liability on royalty payments, and is not entitled to any deduction under tax laws for operating from a special economic zone (SEZ).
The submission has been made by the I-T Department in its reply to Nokia’s plea for unfreezing of its assets in India prior to its $7.20-billion deal with Microsoft.
In case the TDS liability is paid and the deduction under tax laws for operating from a SEZ is available to Nokia, then its total tax liability (existing and anticipated), including penalty would be Rs.14,200 crore.
Meanwhile, a bench of justices Sanjiv Khanna and Sanjeev Sachdeva adjourned the hearing on Nokia’s plea to Tuesday.
‘No official tax claim’ However, Nokia said it had not been served with ‘any official claim’ of the Income Tax (I-T) Department, which had told the Delhi High Court that the mobile company owed it Rs.21,153 crore as tax liability (existing and anticipated), including penalty.
The company, in a statement, said that in the recent months it had seen and read about many claims from the I-T Department and added that these were ‘without merit’, and it would defend itself ‘vigorously’ in the court.
“We have not been served with any official claim, so we cannot comment on this. We want to stress that our main focus right now is to remove the freeze on our Indian assets, including Chennai, before the deadline of December 12. “In recent months, we have seen and read about many claims from the tax authorities. We feel they are without merit and will defend ourselves vigorously in court,” the statement said.
Offers to pay Rs.3,000 crore A senior Nokia official, meanwhile, said it had offered to pay about Rs.3,000 crore to the government to resolve the tax row so that its Chennai manufacturing plant could be de-frozen for sale to Microsoft Corporation.
Since the facility would have no use for Nokia post the Microsoft deal, they would try to find another buyer for it, the official told PTI.
Nokia also offered the government that it would deposit Rs.700 crore so that it could continue to fight the case, besides its offer that if the authorities allowed sale of the Chennai unit, the firm would deposit the cash generated out of it with them, which would be a minimum of Rs.2,250 crore.
