Nokia to appeal deposit order of Madras HC

The Madras High Court has asked the company to pay 10 per cent of the Rs 2,400 crore claim by the State tax authorities

Nokia India, which is fighting a legal battle on tax disputes in the country, said it would now appeal to the division bench against a part of the Madras high court order on the Rs 2,400 crore tax issue between the company and Tamil Nadu sales tax department.

The company recently said, “Nokia welcomes the April 29 ruling of the Madras high court dismissing the overall claim of the Tamil Nadu tax authorities. Given this ruling, Nokia will now appeal to the division bench to overturn the deposit recommendation.”

On April 29, the Madras HC asked Nokia to pay 10 per cent of the Tamil Nadu sales department’s tax claim in eight weeks. The direction was on the ongoing Rs 2,400 crore tax dispute between Nokia and the state sales department.

Pronouncing the order, Justice B Rajendran also remanded the matter back to the deputy commissioner of commercial tax for fresh consideration. The court also directed the commissioner to afford an opportunity of personal hearing to Nokia, peruse the documents that may be produced by the petitioner and then pass orders on merit and in accordance with the law.

The court further said the revenue also had to be safeguarded to some extent. “In that view of the matter, out of the total demand of Rs 2,400 crore, the petitioner is directed to deposit 10 per cent of the tax amount thereof as a pre-condition for reviving the orders of assessment. This amount shall be deposited by the petitioner (Nokia) within a period of eight weeks,” said the order.

The direction came despite the fact the company earlier argued that it doesn’t have any solid cash. Nokia’s senior counsel Arvind Datar earlier told the court “the company doesn’t have enough liquidity to pay, as it has paid over Rs 780 crore in 2013-14 to the I-T department (at the Centre on the ongoing Rs 21,000 crore tax dispute).” He also argued it was not given opportunity for personnel hearing.

The authorities alleged the company sold mobile phones meant for exports in the domestic market and they need to pay VAT for the financial years 2009-10, 2010-11 and 2011-12.