Cairn Energy: Cairn Energy began the process of seizing India’s assets abroad for a recovery of $ 1.7 billion.
Air India (File Photo-PTI)
Britain’s petroleum company Cairn Energy has filed a lawsuit in the US against the Indian government in connection with the recovery of $ 1.7 billion. Under this, the company can confiscate the assets of Indian government companies like Air India. The case relates to the tax imposed on the company under an amendment to the Income Tax Act with effect from the previous date. Cairn challenged it in the International Arbitration Tribunal and the decision of the tribunal has come in his favor.
On May 14, Cairn filed a case in the court of the South District of New York and appealed to Air India-owned airline India as an integral part of the Government of India. Based on this, she wants to seize the assets of the Government of India located abroad and recover her money. He says that Air India and the Government of India are the same.
Solicitation of declaration of Air India debtor
A report said that the company could file a case for not taking any distinction between public sector undertakings of India and the Government of India for such action. According to sources, Cairn has requested the New York court to declare Air India its debtor in the case.
The company has moved the courts of the US, UK, Canada, France, Singapore and the Netherlands regarding the decree of the arbitration forum. The Arbitration Forum has since last date rejected the demand of imposing a tax of Rs 10,247 crore on the company in India through a law amendment.
It has also ordered the Income Tax Department to refund the value of the shares sold of the company, forfeited dividends and withheld tax refunds.
Cairn started filing lawsuits in other countries
Three sources who have direct knowledge of the development said that the company has now sought to remove the distinction between the government of India and the companies owned by it in the oil and gas, shipping, airline and banking sectors in the US and other countries. Has started filing the case.
Sources said that the company has identified the properties of India abroad which it will claim.
Necessary steps are being taken to protect the interest of shareholders
Cairn has said that it is taking all necessary steps to protect the interest of shareholders. But the Government of India has said that levying tax is a universal right of every government and it will defend itself against such illegal action of recovery on behalf of the company.
A spokesperson of the company said that the arbitration does not end with the decree of the court, it is taking necessary steps to protect the interests of the shareholders.
The spokesman also said that Cairn is always ready to continue constructive dialogue with the Government of India to resolve this long-running matter.
First started work in India in 1994
In 1994, Cairn took the first step in the exploration and excavation work of oil and gas in India. He found a large stock of oil in Rajasthan. He listed Cairn India in the Mumbai stock market in 2006.
Five years after this, the government had sent a notice demanding a capital gain-tax of Rs 10,247 crore on the company under the provision of law amendment from the previous date, including costs and interest etc.
The case reached the International Arbitration Forum through the departmental and judicial forums in India.
Even after the December 2020 decision of the Hague arbitration court, representatives of Cairn had three meetings with the then Revenue Secretary Ajay Bhushan in February but the matter did not materialize.
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