- Friday, April 19, 2024
By: Radhakrishna N S
A SCOTTISH energy company said today (28) that the much-awaited outcome of its £1.09 billion tax claim against India could be delivered in 2020.
The Arbitral Tribunal told Cairn Energy that while it couldn’t commit to a particular award release date, it expected to be in a position to issue the award in the summer of next year.
The company said in a statement on Monday (28): “Cairn continues to have a high level of confidence in the merits of its claims in the arbitration and is seeking full restitution for losses of more than $1.4bn (£1.09bn),”
“The Arbitral Tribunal has indicated that it expects to be in a position to issue the award in the summer of 2020, but has clarified that to avoid any misunderstanding, the tribunal did not intend firmly to commit to a specific award-release date, nor is it yet in a position to do so.”
The Edinburgh-based firm is seeking over £1bn in compensation under the UK-India Bilateral Investment Treaty.
The final hearings completed in The Hague last year and Cairn earlier expected an award to be made in the near future.
Cairn commenced proceedings against India in 2015 following retrospective taxation actions undertaken by the Indian Income Tax Department in 2014.
The long-running tax row centres on restructuring undertaken by Cairn ahead of the flotation of its Indian subsidiary in 2007.
Cairn said India was trying to retrospectively apply tax legislation introduced in 2012 to transactions made by the firm six years earlier.
The India income tax department had confiscated dividends owed to the company from its shareholding in business giant Vedanta in which it held a stake.
The country’s income tax department also withheld cash from the sale of a portion of Cairn’s shareholding in Vedanta.
