Nokia asks Delhi High Court to release factory seized in tax dispute

Nokia has asked the Delhi High Court to help release its Indian factory after its seizure by the local tax authorities, the Finnish firm said on Thursday as it seeks to resolve the tax dispute ahead of the sale of its mobile phone business to Microsoft.

(Also see: Nokia India owes Rs. 2080 crores in taxes, court order reveals)

Nokia said it did not expect the dispute to affect its 5.4 billion euros deal with Microsoft, although it was prepared for the possibility that the Chennai plant, one of its biggest phone-making factories, will not be transferred to the U.S. company in time for the sale, which is due to close in the first quarter of next year.

If the seizure is still in place when the Microsoft deal is finalised, Nokia could briefly operate the plant as a contract manufacturer for Microsoft, according to sources close to the company.

(Also see: Nokia shareholders approve sale of mobile division to Microsoft)

Nokia has been in disagreement with the Indian authorities over an income tax bill of 20.8 billion rupees, one of several tax disagreements involving foreign companies in India.

In a statement, Nokia said it wanted the assets to be released by December 12. The sources said the court will hold a hearing on November 28.

(Also see: Nokia gets favourable ruling on frozen assets in India tax dispute)

($1=0.7428 euros) ($1=62.5450 rupees)

© Thomson Reuters 2013