Delhi High Court to issue verdict on Nokia India tax dispute on Thursday

A court will issue on Thursday its verdict on Nokia's appeal against the seizure by tax authorities of its local factory after a tax dispute, lawyers for the company and the tax department said on Wednesday.

The Chennai factory is one of Nokia's biggest phone-making plants. Nokia has been trying to end the dispute ahead of the sale of its mobile phone business to Microsoft in a 5.4 billion euros deal.

On Tuesday, the Delhi High Court extended a hearing over local tax authorities' seizure of a Nokia factory by seeking information from the IT department on the plant value, adding to concerns whether the company can transfer the property to Microsoft as part of the sale of its mobile phone business.

Nokia had previously said it wanted the assets to be released by December 12, as that was its deadline for including the plant in the sale to Microsoft.

(Also see: Nokia Chennai plant to be excluded from Microsoft deal if tax dispute continues)

Nokia had offered to pay a 270 million euro deposit to authorities to unfreeze assets in the tax dispute, according to sources familiar with the matter quoted in previous reports.

A lawyer for the tax department said on Tuesday Nokia owed 78 billion rupees in tax payments. The Times of India reported on Tuesday the tax department had informed the Delhi High Court that Nokia owned the authorities more than 210 billion rupees, which included penalty for a seven-year period beginning 2006.

Also see: Nokia owes Rs. 21,153 crores as total tax liability: IT department)

Nokia said it had not been served with any claim beyond that 20.8 billion rupee amount. "In recent months we have seen and read about many claims from the tax authorities," the company said in a statement on Tuesday. "We feel they are without merit and will defend ourselves vigorously in court."

With inputs from Reuters