The government has ordered a special audit into the accounts of Nokia India, widening the ambit of its dispute with the Finnish handset maker and further queering the pitch for the completion of the company's $7.2 billion global deal to sell its devices business to Microsoft.

A Nokia spokesperson confirmed receiving the notice for the special audit. "As with all tax discussions in India, Nokia will cooperate with the authorities and, where necessary, defend itself vigorously", the spokesperson said.

Tax laws allow the government to order a special audit on a private company through a third-party auditor for a deeper probe into suspected undisclosed income, unpaid or underpaid taxes, among others.

Nokia is already facing a slew of tax cases worth thousands of crores in a market where it was once the leader but has since slipped dramatically in the face of strong competition.