Physical assets owned by Nokia, including a leading manufacturing facility, have been frozen by the Indian tax authorities in a dispute over the company’s tax bill.

The handset vendor’s bank accounts in India were also frozen but subsequently freed up, following a court ruling in Nokia’s favour. But fixed assets, such as buildings, remain frozen. These include a factory in Tamil Nadu that is one of Nokia’s largest.

However, the dispute appears unlikely to disrupt the proposed sale of Nokia’s handset business to Microsoft.

Assets that are currently frozen do include some in the $7 billion deal with Microsoft that was announced in early September.

However, India is just a small element in the deal, say analysts.

“Assets in India are of meager importance to Microsoft at this stage,” Pierre Ferragu of Sanford C. Bernstein, told the Wall Street Journal. “They’ll become the new owner of these frozen assets or they will proceed with the deal excluding these assets and wait for the situation to be clarified.”

The tax authorities froze Nokia’s bank accounts and assets on Wednesday last week.  Following an appeal to the Delhi High Court, its bank accounts were unfrozen on Thursday allowing the company to move funds held there. However, its fixed assets have remained frozen.

But this is not the first shot in the dispute. At the start of the year, Nokia offices and the same factory were raided by tax officials.