Nokia’s tax troubles mounted on Friday after the Tamil Nadu tax authorities claimed that the devices that the Finnish handset maker made at its Chennai plant were not exported and were instead sold domestically.

According to sources, the Tamil Nadu VAT department is now moving to assess sales tax on the export of devices from the company’s Chennai facility. The tax demand notice that has been served is for Rs. 2,400 crore.

'Nokia considers the claim to be completely without merit and counter to domestic tax laws. In India, exports are by law exempt from tax, and Nokia has proved consistently that devices produced at Chennai are exported abroad,' the company said in a statement.

According to a company spokesperson, Nokia has filed a writ to the Madras High Court to contest the Tamil Nadu tax authorities’ claim.

'It is absurd that the Tamil Nadu tax authority is now claiming that devices made in Chennai were not exported and were instead sold domestically in India. We contend that this allegation has no basis in reality whatsoever; it could easily be rebuffed by a check of documentation provided to various governmental departments including Customs,' the company said.