NOKIANEWS - News of the Nokia

An attempt to tax Nokia's Indian operations has been derailed by the Delhi High Court

19. 12. 2022 Monday / By: Robert Denes / Industrial / Exact time: BST / Print this page

The Delhi High Court dismissed the tax department's appeal against Nokia Solutions and Networks OY. The ministry had approached the apex court against the order of the Delhi Bench of Income-Tax Appellate Tribunal, which demarcated the tax levied on Nokia's Indian operations.

The Delhi ITAT found that since Nokia was incurring losses in its Indian operations, the revenue department could not have taxed the domestic business of the Finnish company. The Supreme Court affirmed this conclusion./p>

Nokia would have been liable to tax if it had earned net profits from its Indian operations and had a permanent establishment i.e. a permanent establishment in India.

However, the Delhi ITAT found it wrong and arrived at a loss figure considering various expenses against the gross profit. He pointed out that even if Nokia had a private entity in India, there could be no tax liability in India as Nokia incurred losses from its operations in India.

The ITAT also observed that Nokia had booked a 'global net loss' in the relevant assessment year and therefore no profit could have been attributed to it.

He observed that “a plain reading of Article 7(1) [of the India-Finland Tax Treaty] would show that the question of liability to tax would arise for the respondent/audit only when the profits of the respondent/audit are received and that only to the extent of attributable to Indian PE. In view of this position, we are not willing to accept the appeal."

The Delhi High Court, without going much into the factual and legal details, upheld the order of the ITAT.


Via Link
gifgifgif

Phone

+44

Address

Canning Town, Barking Road
London E13 8EQ
United Kingdom