Workers of Nokia Chennai on hunger strike

Chennai, Mar.31: Nearly 3, 000 workers of Nokia India on Monday protested in Chennai and sat on a hunger strike over delay in transfer of Sriperumbudur facility to software giant, Microsoft.

The Finnish firm said both companies remain committed to the deal, and Microsoft said it expects it to close next month.

Nokia also reiterated that its tax disputes in India would not have an impact on the deal schedule.

Indian authorities hit the company with a new $414 million tax, following a Supreme Court decision ordering Nokia to give a $571 million guarantee before transferring its Chennai factory to Microsoft.

However, president of Centre of Indian Trade Unions (CITU), A. Soundararajan, said the process has been extended for another month.

“The number one mobile maker in the world, I don’t know what is the reason but they have sold the company to Microsoft. Microsoft is taking over all the facilities and all the properties. The process is taking on. It was expected that it will end by 31st March but now it is getting extended for another month but the problem is that the Chennai facility has failed to comply with the task, rules and laws. So, the central government has filed a case against them. It is pending in Delhi High Court. The court has freezed the assets of the Chennai facility,” said Soundararajan.

The workers of the facility alleged that the mobile maker has shifted the production of the unit to other centres.

Soundararajan stated workers will not accept any move from the company to remain as a contract manufacturer for Microsoft or retrenchment.

Tamil Nadu Government did levy Rs 2,400 crore sales tax claims on the company earlier this month.

The Union has decided to approach Tamil Nadu Chief Minister Jayaram Jayalalithaa regarding employees’ job security.

Earlier on December 12, 2013 Nokia had won an appeal to release one of its biggest phone-making factories in Chennai, seized by authorities in a tax dispute, allowing the transfer of the plant as part of the sale of its mobile phone business to Microsoft.

Nokia had appealed the plants seizure at Delhi High Court and was trying to resolve the dispute ahead of the closure of the 5.4 billion euro ($7.4 billion) Microsoft deal.

The Delhi High Court asked the Finnish company to deposit 22.50 billion rupees ($367.17 million) in an escrow account as a condition for lifting the freeze and transferring the facility to Microsoft.

Nokia’s case is one of several high-profile tax disputes involving foreign companies in India, which has stepped up its pursuit of claims against such firms as it seeks to rein in its budget deficit.

Other foreign firms recently involved in tax disputes in India include IBM, Royal Dutch Shell, Vodafone Plc and LG Electronics Inc.

An extended asset freeze as a result of the dispute would have blocked Nokia from transferring ownership of the Chennai plant, possibly forcing it to operate as a subcontractor for Microsoft. (ANI)