Minister of State for Finance Pankaj Choudhary said in a written reply in the Rajya Sabha on Tuesday that the government has challenged the decision of the International Tribunal to quash the retrospective tax order of Rs 10,247 crore on Cairn Energy. He said, “A French court has ordered the confiscation of certain assets of India in a case related to Cairn Energy.”
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PTI had reported earlier this month that most of these 20 properties are flats. Their value is more than 20 million euros. A three-member international tribunal in December last year unanimously ruled in favor of Cairn in the case and set aside the retrospective tax order. The tribunal also included judges appointed on behalf of India.
Tell you what was the whole matter?
Let us tell you that Cairn is a UK company and in the year 2007, IPO was offered to list the company. At the same time, a year before that, the company had merged many of its units in India, but even after this merger, there was no change in their ownership. Seven years later, when the tax department in India sent him a capital gains tax notice, he told Cairn in 2014 that he had merged several of his units with Cairn India before the IPO. Due to this he had made capital gain, so he would have to pay tax. Cairn went to court against it.
The tax department of India took over more than 10 percent of the shares of the company. After hearing this case, the Arbitration Court of The Hague in the Netherlands ruled against the Indian government. He directed Cairn to repay this amount along with interest.
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