Indian tax dispute will not disrupt Microsoft sale, says Nokia

Nokia has stated that the sale of its Devices & Services unit to Microsoft will not be affected by its continuing legal dispute with the Indian tax authorities.

After the transferral of ownership of a Chennai factory from Nokia to Microsoft was disrupted, the Finnish vendor has appealed to the Indian Supreme Court against the offending conditions imposed by the country’s tax authorities.

A dispute arising from the new conditions resulted in the factory being seized. It was only released in December 2013 once Nokia had deposited a pre-agreed amount of cash in an escrow account. The Delhi High Court has now stated that Nokia must pay deposits on local authority tax claims before it is able to dispute them.

The vendor stated: “The court is requesting us to give a simple undertaking which would obligate us to respond to any claims that the tax authorities have before we exhaust legal remedies. We cannot do that – especially in a situation when the actions of the tax authorities have been arbitrary in the past year.”

Nokia chairman and interim CEO Risto Siilasmaa said that if the dispute derailed the Microsoft sale this would be “detrimental to our employees” as “we will have a factory, but we will not have a business”.

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