NEW DELHI--An Indian court has asked tax officials to review a
24 billion rupees ($397 million) claim on the local unit of Nokia
Corp, providing some relief to the Finnish company that has been
fighting several tax cases in the south Asian country.
The Madras High Court -- in the southern state of Tamil Nadu --
Tuesday also ordered Nokia to deposit 2.4 billion rupees, or 10% of
the claim, as a precondition for the review, according to people
aware of the development.
It still isn't clear whether the Helsinki-based company would
pay the deposit or appeal against it.
In a statement issued Wednesday, the company said that the tax
claim by authorities that it is contesting in court is "without
merit." The company is "weighing its options for legal recourse"
and "will defend itself vigorously," it added.
The claim is one of the many demands that Nokia is facing in
India and relates to its cellphone manufacturing facility in
Chennai Tamil Nadu state. Tax officials had alleged that the
company wrongfully claimed export benefits when the phones
manufactured at the facility were sold in the domestic market.
The plant, one of the largest for the company with more than
6600 employees, had to be excluded from the $7 billion deal under
which Nokia sold its devices and services business to Microsoft
Corp.
Indian authorities froze the factory to ensure they were able to
recover the dues under different claims, which cumulatively could
be close to $4 billion.
In March, India's Supreme Court, while hearing a separate tax
claim against Nokia, had asked the company to pay that demand and
provide a 35 billion rupee deposit to get the factory unfrozen.
Write to R. Jai Krishna at krishna.jai@wsj.com
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