Cairn Energy CEO meets Indian finance secretary as shareholders impatiently wait for action on the $1.4 billion tax dispute
Cairn Energy Twitter
Cairn Energyplc CEO Simon Thomson called upon the union finance ministry to see a possible solution outside the legal options to get $1.4 billion in a tax dispute against India.
- Cairn Energy plc CEO Simon Thomson told reporters that the meeting with the finance secretary was constructive.
- This comes days after the company moved the US, the UK and the Netherlands courts to get $1.4 billion in a tax dispute against India.
AdvertisementDays after filing cases in the US, the UK and the Netherlands courts to get $1.4 billion in a tax dispute against India, UK-based Cairn Energy plc called upon the union finance ministry to see a possible solution outside the legal options.
Cairn Energy plc CEO Simon Thomson told reporters that the meeting with the finance secretary was constructive. He further declined to make any other comments.
Earlier last week, Thomson had sought a meeting with finance minister Nirmala Sitharaman during his visit to India. FM reportedly authorised the finance secretary Ajay Bhushan Pandey to meet him and hear out the company.
A Cairn Energy Plc spokesperson also declined to comment when Business Insider India requested a response on Thomson and Pandey’s meeting.
The report said that both the Indian government and Cairn would be sitting with an open mind to see a possible solution outside the legal options. It added that, meanwhile, the Finance Ministry has already referred the matter to the law ministry and Attorney General of India seeking their opinion on the future course of action of India.
Cairn Energy CEO Simon Thomson is looking forward to meeting the Government of India Finance Minister in Delhi next… https://t.co/byreMRhkVJ— Cairn Energy PLC (@CairnEnergy) 1612872283000
What has happened so far?
In December, an international tribunal had unanimously ordered the government to desist from seeking up to $1.4 billion from Cairn Energy PLC of the U.K.
The court said that India violated its obligations under the UK-India Bilateral Investment Treaty in 2014. The government seized Cairn's residual 10% stake in India business after seeking $1.4 billion in taxes in alleged capital gains from the company over a 2006-07 internal reorganisation of the business.
According to the Indian government, the current pending tax demand against the company — including tax, interest for non-payment and penalty — is around $3 billion.
In the letter to the finance ministry last month, Cairn had said its shareholders "expect an early resolution, failing which they will expect Cairn to pursue the award in conformity with its rights under the treaty".
Advertisement"The award can be enforced against Indian assets in numerous jurisdictions around the world for which the necessary preparations have been put in place," it added.
Cairn Energy had sold Cairn India, in 2011, to mining billionaire Anil Agarwal's Vedanta Group, except for a minor stake of 9.8%. It wanted to sell the residual stake as well but was barred by the I-T department from doing so. The government also froze the payment of dividends by Cairn India to Cairn Energy.
(with additional inputs from PTI)
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