India and Finland have reportedly reached an agreement on a high profile tax case involving Nokia India and parent Nokia Corp, which clears the way for sale of the Finnish company's manufacturing plant in Chennai.
According to a report in The Economic Times, the counties have settled the dispute under the Mutual Agreement Procedure (MAP) that essentially closes all pending proceedings related to a tax matter.
“Resolution has been reached. Nokia has agreed to make provisional tax payment,” a senior income tax department official was quoted as saying by the newspaper.
Nokia's assets in India, including its Chennai plant had been frozen over the unresolved tax case.
With the dispute behind it, the firm can now offload those assets. The firm has permission from the income tax authorities, and the Madras and Delhi high courts to sell the Chennai plant. A potential buyer could be Taiwanese contract manufacturer Foxconn, understood to have expressed its interest in taking over the mobile phone manufacturing plant.
Nokia currently employs 6,300 people in Finland and around 102,800 globally.
In March, Finland's government investment arm Solidium acquired a 3.3 percent stake in Nokia at about 844 million euros ($1.04 billion), to strengthen Finnish influence over the telecom network gear maker.
Nokia ruled the global mobile phone market a decade ago and was a dominant economic engine for Finland, contributing four percent of its GDP and 20 percent of the nation's exports. Nokia's collapse was a major reason for Finland's decade of stagnation from which it is only just recovering.
With inputs from agencies
Updated Date: Apr 20, 2018 13:30 PM