Tamil Nadu dials Nokia with Rs24bn tax notice

Stephen Elop, head of devices at Nokia, speaks during a news conference in Barcelona. The Finnish mobile manufactureryesterday termed the Tamil Nadu government’s Rs24bn tax notice as absurd and said the claim has no basis.

IANS

Chennai, India

Finnish mobile phone manufacturer Nokia on Friday termed the Tamil Nadu government’s tax notice of around Rs24bn for three years – 2009-10, 2010-11 and 2011-12 as “absurd” and said the claim “has no basis”.

“Nokia has on Friday filed a writ to the Chennai High Court to contest a claim from the Tamil Nadu tax department, which has moved to assess sales tax on the export of devices from the company’s Chennai facility,” the company said in a statement.

“It is absurd that the Tamil Nadu tax authority is now claiming that devices made in Chennai were not exported and were instead sold domestically in India,” it said.

“We contend that this allegation 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.

According to Nokia, the tax department’s claim is 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 abroad,” the company said.

However, the company declined to answer IANS queries on the sales break-up – domestic and exports – for the years for which the tax demand was raised by the state government.

The company was also silent to queries about the sales tax exemption given to it by the state government while setting up the production unit near here.

This is new trouble for Nokia which has been charged with Rs21,000 crore tax evasion by the Income Tax department.