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NEW DELHI: Cairn Energy has received a world arbitration case towards the Indian authorities over a tax dispute, ending one of many nation’s highest-profile disputes, two sources with direct information of the matter informed Reuters.
Cairn took the case to arbitration in 2015 to battle towards a requirement in 2014 from the Indian tax division for 102 billion rupees ($1.four billion) in taxes it mentioned had been owed on capital positive factors associated to the 2007 itemizing of its Indian unit.
In 2011, Cairn Energy bought its majority stake in Cairn India to Vedanta Ltd, lowering its stake within the Indian firm to about 10%.
The Indian authorities seized the remaining shares in 2014 after the tax grievance was made, in addition to dividends Vedanta owed to Cairn Energy for its holdings within the Indian agency.
In 2018, Cairn Energy mentioned it might write down the worth of its funding in Vedanta after Indian tax authorities bought $216 million price of its shares within the Indian mining firm.
The Indian authorities didn’t instantly reply to a request for remark. Cairn Energy couldn’t be reached.
Shares in Vedanta rose as a lot as 5% on Wednesday.
The arbitration was initiated below the India-U.Ok. funding treaty and Cairn had sought damages of over $1 billion on the time.
It was not instantly clear what damages the worldwide arbitration court docket awarded to Cairn.
The ruling comes weeks after India misplaced a world arbitration case towards Vodafone Plc in September over a $2 billion retrospective tax dispute which had spooked traders on the time.
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