Indicating the possibility of an out-of-court settlement of a pending tax dispute that led to the closure of Nokia’s plant at Sriperumbudur, the Centre on Monday said it is considering all options to revive the unit and address concerns of around 25,000 workers rendered jobless.
The Modi government, which is hard-selling India’s potential to be a manufacturing hub with its ‘Make in India’ campaign, said it was trying to ensure that there was no repeat of such an incident.
Pointing out that Prime Minister Narendra Modi had himself said the government wanted to resolve the crisis, commerce and industry minister Nirmala Sitharaman told reporters, “We are looking at all constructive steps that can be taken to help the situation. We want workers to get justice. We are working very hard to ensure that there is no repeat of such an incident.”
She said the incident had raised the “question of how the Indian taxation policy, the duty structure have all adversely affected setting up of industry. I am very concerned and on that the government is looking into details”.
Nokia closed down the unit on November 1 last year, citing lack of fresh orders from its new parent Microsoft Corporation, consequent to the termination of a purchase agreement. But what led to the plant shutdown was also a couple of tax demands it continues to fight in Indian courts. The Modi government reckons that bringing the Nokia unit back to life would bear testimony to its ability to boost investor confidence.
The income-tax department had, in 2013, raised a demand of Rs 21,153 crore on Nokia in 2013 over non-deduction of tax at source concerning royalty payments to its then parent, the Finland-based Nokia Oyj. When it received the I-T notice, it was preparing to sell its assets in India to Microsoft as part of a global transaction.
