Following the Central Government's decision to not contest Bombay High Court's decision giving relief to Vodafone in Rs 3200 crore retrospective tax case, Nokia has once again asked the tax authorities to lift the asset freeze so that it could sell its 210-acre India plant located in Sriperumbudur near Chennai.
The company, in an emailed statement to dna, said, "Nokia’s main focus at the moment is what we have consistently said since October: with production at Chennai suspended, we call on the government to lift the asset freeze imposed by the tax authorities so we can explore potential opportunities for a sale to a suitable buyer."
The company said that finding a buyer for the plant where it made mobile phones is an "urgent prerogative" not only for Nokia but for India which is pushing local manufacturing and reducing electronic imports.
"We believe that an eventual sale would offer a far brighter option for employment in the region and support the government’s “Make in India” initiative," Nokia said.
Nokia, which exited the mobile phone manufacturing by selling the business to Microsoft for $7.2 billion had to leave this plant out of the deal because of the retrospective tax demand raised by the Indian tax authorities.
The Income Tax department put a freeze of Nokia's Chennai factory and demanded Rs 3000 crore to be put in an escrow account. Later, the Tamil Nadu government, too, asked for a Rs 2400 crore commercial tax from the company.
Following this, Nokia decided to down shutters on its 210-acre factory in the southern part of India.
Finance Minister Arun Jaitley has repeatedly stressed that the government will retort to the burden of retrospective taxation. This move was aimed at boosting investor sentiments and reviving manufacturing in the country.
On Wednesday, the government said that it will not appeal against Bombay HC order in Vodafone case.
Vodafone welcomed the decision.
Ficci Secretary, General Didar Singh, commented, "We believe that it is a very appropriate decision and this will go a long way in correcting the perception of the tax administration being adversarial. It will help in creating a conducive tax environment, specially for the overseas investment community."
However, the government made it clear that all the cases under retrospective taxation order will be taken up on a 'case by case' basis.
In October 2013, the Delhi High Court ruled in Nokia's favour and some assets were unfrozen.
However, its assets in India continue to be put of freeze by the government and the company hopes the matter is resolved so that it could find a potential buyer for the factory and production could begin again.
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