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I-T dept rejects Nokia’s challenge to tax demand

Tax authorities have dismissed Nokia's appeal against an income tax demand of Rs 2,080 crore, a decision which the Finnish mobile phone marker says it may challenge in Delhi High Court.

The Commissioner of Income-Tax (Appeals) rejected Nokia's challenge for the tax demand notice for five fiscal years starting 2006-07.
The company said it is examining all options, including going to the Delhi High Court in appeal.
'Nokia is disappointed by the decision of the Commissioner of Income-tax (Appeals), and will now examine all options open to it. These include taking the case back to the Delhi High Court,' it said in a statement

Nokia's India unit was served the tax demand in March. The notice issued by Income Tax Department alleged tax evasion by Nokia on royalty payments made against supply of software by the company's parent firm. Royalty payments attract a 10 per cent tax deduction under the Tax Deducted at Source (TDS) category.

'In addition to the legal action Nokia is taking in India, it is worth remembering that the Ministry of Finance in Finland has launched the Mutual Agreement Procedure with its counterpart in India under the bilateral Double Taxation Avoidance Agreement to reach a common understanding on the matter. ,' the company statement added.
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