The Central Board of Direct Taxes has just said that reports about a fresh tax demand by the Income Tax department from Nokia are erroneous. Clarifying reports that emerged earlier, the CBDT said that the recent tax demand pertains to an earlier order.
The Central Board of Direct Taxes has just said that reports about a fresh tax demand by the Income Tax department from Nokia are erroneous. Clarifying reports that emerged earlier, the CBDT said that the recent tax demand pertains to an earlier order.
The CBDT said that an assessment order was passed in the Nokia India case for 2010-11 assessment year in August 2015. "Tax demand raised by this order was primarily based on issues arising from earlier orders," the CBDT said.
Reports in media that IT Dept has issued fresh demand notice to Nokia India. Reports are erroneous: CBDT
— ANI (@ANI_news) October 10, 2015
Assessment order was passed in case of Nokia India for 2010-11 assessment yr in August 2015 (Continued): CBDT
— ANI (@ANI_news) October 10, 2015
Tax demand raised by this order was primarily based on issues arising from earlier orders: CBDT
— ANI (@ANI_news) October 10, 2015
Income Tax department said a tax demand notice has been served on Nokia India after it completed an assessment for 2010-11 in August this year in the existing dispute over royalty payments to its parent company.
"An assessment order was passed in the case of Nokia India Pvt Ltd for Assessment Year (AY) 2010-11 in August 2015. The tax demand raised by this order was primarily based on issues arising from earlier orders," a tax department statement said.
The tax demand arose from the assessment order passed in August 2015 and it is being considered under the Mutual Agreement Procedure (MAP) of the India-Finland tax treaty.
"The demand arising from the assessment order passed in August, along with the demands raised earlier are already being considered under MAP of the India-Finland tax treaty by the Competent Authorities in both countries," it added.
Earlier in 2013, the department had slapped a tax notice of Rs 2,000 crore on Nokia's Indian subsidiary for violating the withholding tax norms since 2006 while making royalty payments to the parent company in Finland.
News about a fresh tax demand came soon after the Bombay High Court ruled in favour of Vodafone, saving it millions of dollars in payouts. The Bombay High Court on Thursday set aside an order of Income Tax Appellate Tribunal (ITAT) which had ruled that the IT department had powers to raise tax demand on the company in a Rs 8,500 crore transfer pricing case. The transfer pricing case dates back to 2008 relating to sale of one of its call centres in Ahmedabad in 2007.
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