INDIA WILL DEFEND RIGHT TO TAX CAIRN: FINMIN

NEW DELHI: Uk-based Cairn Energy Plc has again approached the government to resolve the $1.2 billion tax dispute amicably, the finance ministry said on Sunday, but denied directing state-owned banks to withdraw funds from foreign currency accounts abroad anticipating Cairn’s move to seize such funds in order to enforce the arbitral award.

“Certain vested parties appear to have orchestrated such misleading reporting, which often relies upon unnamed sources and presents a lopsided picture of factual and legal developments in the case,” the finance ministry said. Cairn has been taking legal measures to enforce an international arbitration tribunal’s award of $1.2 billion (plus interest and costs) since December last year, which includes its reported attempt to attach assets belonging to the Government of India or stateowned firms such as Air India. Reuters reported it on May 15.

An international tribunal on December 22, 2020, asked India to return $1.2 billion (plus interest and costs), the disputed retrospective tax amount to Cairn Energy. India contested the arbitral award in March this year.

“Government of India [GOI] is vigorously defending its case in this legal dispute. It is a fact that the government has filed an application on March 22 to set aside the highly flawed December 2020 international arbitral award in The Hague Court of Appeal,” the finance ministry’s statement said. “The arbitral tribunal improperly exercised jurisdiction over a national tax dispute that the Republic of India never offered or agreed to arbitrate,” it said.