Supreme Court orders Nokia to pay up to regain control of Chennai based factoryWritten by Manish Singh on March 15, 2014 - 05:05PM @refsrc
The Supreme Court of India has turned down Nokia's appeal to allow the Finnish giant to hand over its Chennai located factory to Microsoft. This decision comes after the Delhi High Court’s ruling over transferring the freehold of Nokia's mobile phone plant to Microsoft, which is the subject of a tax dispute with the Indian government. Subsequently, the Supreme Court also ordered Nokia to pay a hefty sum of 35 billion rupees to guarantee its claim over one of its biggest factories.
Nokia was supposed to pay up 22.5 billion rupees to regain control of the plant, until the Delhi High Court added a few more conditions and asked the Finnish giant to pay an additional sum of money as penalties and future tax claims in an escrow account.
Microsoft bought Nokia’s services and product divisions for a sum of 7.5 billion dollars. The deal is to be completed by the end of this month. If Nokia fails to regain its factory by that time, it might delay the completion of its acquisition deal or may even cut down the original acquisition sum.
If the factory claim isn’t sorted in time, Nokia might have to run it as a contractor to Microsoft. But the lawyers are pretty sure that this won’t last long, in case it does happen.
Of course, if Nokia decides to shut down the factory, it will not only be a huge loss to the company, but also result in 8,000 people being left unemployed.