updated 10:22 pm EST, Tue December 10, 2013
Chennai plant seized by tax authority, Nokia offers deposit to release assets
Some confusion exists in India about back taxes owed by Nokia, which is potentially complicating the Microsoft purchase of the embattled cellphone manufacturer. An Indian court has stayed a hearing about a seizure of a factory in Chennai, and is seeking additional information from the cellphone manufacturer on the value of the facility. Additionally, various accounts claim that Nokia owes either 20.8 billion, 78 billion, or 210 billion rupees ($400 million, $1.28 billion, or $3.4 billion respectively) in taxes to the Indian government.
The Delhi high court is going to hear from both the tax authority and Nokia on Wednesday, regarding the value of the factory. Nokia claims to have only been informed of a $400 million tax debt, and questions the veracity of the higher amounts. Nokia has offered to pay $369 million to release assets that have been seized in the country, according to sources familiar with the matter.
A statement earlier today from Nokia claimed that "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 company is expected to turn the plant over to Microsoft as part of its buyout deal. The deal is worth $7.43 billion, with the potential tax debt owed to India a significant portion of this amount.