‘Cairn India has Indemnity from Former Promoter on 20k-cr Tax’
London: Cairn India has full indemnity from its former promoter Cairn Energy of UK against levy of any tax for past deeds, including the twoyear old .₹ 20,495 crore retrospective tax demand, its new owner Anil Agarwal has said.
Cairn India was in April 2014 slapped with a tax demand of .₹ 20,495 crore for failing to deduct withholding tax on alleged capital gains made by its erstwhile parent company, Cairn Energy in 2006-07 when it reorganised India business. Agarwal’s Vedanta Group acquired Cairn India in 2011 and in the sale purchase agreement Cairn Energy has indemnified it from any tax liability for past years, he told PTI in an interview here.
“Our tax demand is purely on the basis of tax demand on the principal company, that is Cairn Energy. We have absolutely nothing to do with retrospective tax. It is between them (Cairn Energy and Income Tax Department),” Agarwal said.
The tax notice on Cairn India came three months after Income Tax Department using retrospective tax legislation slapped .₹ 10,247 crore tax notice on Cairn Energy in January 2014.