Cairn Energy drags Air India to US court to recover $1.2 billion.
Cairn Energy has filed a lawsuit in a US federal court seeking a direction to Air India to pay $1.26 billion in the arbitration case it won against the Indian government.
New Delhi. Air India has until mid-July to challenge the case filed by UK-based Cairn Energy Plc. This information has been given to news agency PTI quoting sources. Cairn Energy has filed a lawsuit in a US federal court seeking a direction to the airline to pay $1.26 billion in an arbitration case it won against the Indian government. Cairn Energy, in a case filed in the US District Court for the Southern District of New York, has said that Air India is controlled by the Indian government. In such a situation, the court should put the onus of fulfilling the decision of the tribunal on the airline company.
The three-member International Arbitration Tribunal in December unanimously rejected retrospective taxes imposed on Cairn and asked the government to refund the company’s sold shares, forfeited dividends and tax refunds.
Will recover from public sector units like Air India
Judges appointed from India’s side were also included in this tribunal. Although the Indian government had participated in the arbitration process during four years, it refused to accept the decision and filed a petition in the Netherlands court to dismiss it. Cairn has said that it will recover from public sector units like Air India under this decision. At the same time, the government has said that it will oppose any such move. Sources familiar with the matter said Air India has time till mid-July to challenge Cairn’s lawsuit.Cairn India’s 10% stake was forfeited by the Indian government in the tax dispute
It is known that in the retrospective tax case, the International Arbitration Tribunal ruled in favor of UK oil company Cairn Energy in December 2020. In this case, the arbitration court ordered the Indian government to pay $ 1.2 billion to Cairn Energy, in this case of tax dispute, the arbitration court ordered the Indian government to pay $ 1.2 billion in addition to interest and penalty amount This increased the amount to more than $1.4 billion. Let us tell you that in the tax dispute, the Government of India had forfeited 10% stake of Cairn India in the year 2006-07.