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PTI In a setback to India, an international arbitration panel has rejected its demand for a stay on an arbitration initiated by British oil explorer Cairn Energy plc against a Rs.10,247 crore retrospective tax notice. The panel, comprising three judges of international repute, has also turned down India’s application for bifurcation of the issue of whether tax is covered under India-UK bilateral investment protection treaty, sources privy to the development said. Income tax department had in January 2014 charged Cairn Energy of making capital gains on transfer of India assets to a newly created firm, Cairn India and listing it on stock exchanges. Instead of applying long-term capital gains tax, it levied a short-term capital gains tax and slapped a draft tax demand ...

The Dollar Business Bureau Oil energy explorer Cairn has asked India to pay about $6 billion by as compensation for affecting its business through a tax dispute. Scotland-based Cairn said the company is seeking taxes related to transactions carried out to identify the company's structure for Cairn India’s stock market flotation in 2007. Last year, India had asked Cairn to pay $1.6 billion for the 2007 listing of the company’s India operation. Cairn had taken the case to the international arbitration court in The Hague. Cairn had sold its Cairn India’s majority stake to Vedanta Resources in 2011. It said the tax department's investigation had postponed the sale of its outstanding holding in its Indian venture. The investigation, which began in 2011, was worth ...

Source: PTI    British oil firm Cairn Energy plc on Tuesday said it will seek from India over $600 million in damages for loss it suffered in value of its holding from a Rs.10,247-crore tax demand raised on its eight-year-old internal business recognition. The Income Tax Department using a retrospective legislation had in January 2014 issued a draft tax assessment order on Cairn Energy over its 2006 internal business reorganisation and barred it from selling its 9.8% stake in Cairn India. In a statement, Cairn said it had initiated arbitration challenging levy of tax under UK-India Investment Treaty. “International arbitration proceedings to resolve the retrospective tax issue in India have now formally commenced following the agreement between Cairn and the Government of ...