Cairn Energy and Government of India dispute

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The Cairn Energy and Government of India dispute is mainly an ongoing tax and investment dispute which has its origins in 2005–2006.[1][2] The case is closely linked to Cairn's partner in India, Vedanta, and to concepts such Ex post facto law in the form of retrospective taxation, bilateral investment treaties, and international arbitration between private and sovereign states.

Proceedings in the private investor-state arbitration (Cairn Energy PLC & Cairn UK Holdings Limited v. The Republic of India) at the Permanent Court of Arbitration in The Hague began on 22 September 2015 under United Nations Commission on International Trade Law (UNCITRAL) rules. The final arbitration award of Template:Currency was issued on 21 December 2020 in favour of Cairn; though compensation claimed by Cairn had been Template:Currency.[3][4] To enforce the arbitration award, Cairn has registered the award around the world including in countries such as United States, United Kingdom, Canada, France, Singapore, Mauritius, UAE, Cayman Islands and Netherlands.[1] In May 2021, Cairn sued Air India in New York.[5] In July 2021, Tribunal judiciaire de Paris accepts Cairn's claim to seize Indian properties in France.[6]

The case includes Vedanta Resources PLC v. Government of India in the Income Tax Appellate Tribunal of India,Template:Sfn[7] as well as a case in the High Court of Delhi.[8]

India amended its income tax law in 2012, adding an amendment/clarification allowing for it to collect tax on old investments. While India applied the law on Cairn in 2015, it had done the same in 2014 to Vodafone. The case went to the Permanent Court of Arbitration and in September 2020, Vodafone got a ruling in its favour.[9][10] In August 2021 India scrapped its retrospective tax provision.[11]

Timeline

Before 2000

Year Cairn Energy Government of India Related events
1950
1959
1981
1994
  • Cairn invests in India's oil and gas sector.[15]
1996

After 2000

Year Cairn Energy Government of India Related events
2004
2006
2007
2009
2011
2012
2014
2015
2016
2017
  • April: Cairn India merges with Vedanta.[26]
2018
  • January-March: India's income tax department seizes a fraction of Cairns income;[27][28] that is Cairn Energy's 5% stake in Vedanta.[29]
  • A majority of Cairn Energy's seized shares are sold by the Income Tax Department.[30]
  • December: Following merits hearing and final hearing, Tribunal rules in favour of Cairn.[1][24]
2020
  • 25 September: Vodafone get positive ruling from Permanent Court of Arbitration.[32]
  • 24 December: India challenges Vodafone arbitration award in Singapore.[33]
2021
  • February-March: Cairn registers award and moves courts in the United States, United Kingdom, Canada, France, Singapore, Mauritius, Netherlands, United Arab Emirates and the Cayman Islands.[13][1]
  • 22 March: India files counter appeal at The Hauge following an announcement by the Finance Minister Nirmala Sitharaman on 5 March that it's her "duty" to do so.[2][1]
File:The Minister of State for Commerce & Industry (Independent Charge), Smt. Nirmala Sitharaman addressing a press conference, in New Delhi on October 14, 2016.jpg
  • Indian government denies reports of any properties being seized.[6]
  • 5 August: Government of India introduces the Taxation Laws (Amendment) Bill, 2021, undoing the 2012 retrospective tax provision.[11]

See also

References

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 Cairn Energy tax dispute India: All you need to know. The Times of India(9 July 2021). Retrieved 2021-07-09.
  2. ↑ 2.0 2.1 2.2 Arbitration case: Cairn Energy offers to invest $1.2 bn if India relents. Business Standard India(2021-04-12). Retrieved 2021-07-09.
  3. ↑ 3.0 3.1 3.2 3.3 Cases | PCA-CPA — Cairn Energy PLC & Cairn UK Holdings Limited v. The Republic of India. pca-cpa.org. Permanent Court of Arbitration. Retrieved 2021-07-22.
  4. ↑ 4.0 4.1 4.2 4.3 Cairn v. India | Investment Dispute Settlement Navigator | UNCTAD Investment Policy Hub. investmentpolicy.unctad.org. United Nations Conference on Trade and Development. Retrieved 2021-07-09.
  5. ↑ 5.0 5.1 Cairn Energy sues Air India to enforce $1.2 bln arbitration award - court filing. Reuters(2021-05-15). Retrieved 2021-07-22.
  6. ↑ 6.0 6.1 6.2 Cairn gets ruling to freeze Indian assets in Paris. The Indian Express(2021-07-09). Retrieved 2021-07-13.
  7. ↑ Tribunal award in favour of Vedanta upheld by SC, Bindra, Japnam. mint(2020-09-16). Retrieved 2021-07-22.
  8. ↑ $1.4 billion Cairn arbitration award: Nirmala Sitharaman says it's her duty to appeal. The Times of India(5 March 2021). Retrieved 2021-07-24.
  9. ↑ Retrospective taxation: the Vodafone case, and the Hague court ruling, Aryan, Aashish. The Indian Express(2020-09-27). Retrieved 2021-07-24.
  10. ↑ Vodafone-Hutch deal | Retrospective change to I-T Act. mint(2012-03-17). Retrieved 2021-07-24.
  11. ↑ 11.0 11.1 A pragmatic laying to rest of the retrospective tax ghost, Chandorkar, Aashish. Livemint(2021-08-09). Retrieved 2021-08-27.
  12. ↑ Contracting Parties | PCA-CPA. pca-cpa.org. Permanent Court of Arbitration. Retrieved 2021-07-22.
  13. ↑ 13.0 13.1 Cairn says it has identified Indian assets for seizing if it is not paid. The New Indian Express(9 March 2021). Retrieved 2021-07-24.
  14. ↑ A Scottish energy company is using foreign courts to seize Indian assets. Quartz(9 July 2021). Retrieved 2021-07-13.
  15. ↑ 15.0 15.1 FM Sitharaman says looking at how best to sort out Cairn arbitration. Business Standard India(2021-04-22). Retrieved 2021-07-24.
  16. ↑ Ravva Oil and Gas Field. Offshore Technology. Verdict Media (verdict.co.uk). Retrieved 2021-07-13.
  17. ↑ Cairn completes Mangala oil field appraisal drilling. Oil and Gas Journal(12 July 2014). Retrieved 2021-07-09.
  18. ↑ Cairn Energy tax dispute: How the issue unfolded. Business Standard India(2015-03-12). Retrieved 2021-07-09.
  19. ↑ 19.0 19.1 19.2 I-T Dept slaps Rs 20,495 cr tax demand on Cairn India. Business Standard India(2015-03-14). Retrieved 2021-07-09.
  20. ↑ 20.0 20.1 Repercussions Of Retrospective Tax Amendments In India – In Light Of Cairn And Vodafone, Chandra, Naomi. www.mondaq.com(21 June 2021). Retrieved 2021-07-30.
  21. ↑ PM launches Cairn India's oil fields in Barmer. Hindustan Times(2009-08-29). Retrieved 2021-07-09.
  22. ↑ Cairn versus India: What lies ahead. Mint(2021-07-08). Retrieved 2021-07-09.
  23. ↑ Budget 2014: Vodafone to continue international arbitration; 2012 retro-tax amendment stays. The Economic Times(11 July 2014). Retrieved 2021-07-13.
  24. ↑ 24.0 24.1 24.2 Cairn Energy and Government of India - Retrospective tax arbitration proceedings. Cairn Energy. Accessed on 13 July 2021. Archived on 21 January 2021.
  25. ↑ Blow to India, Cairn wins $1.2-b award in retrospective tax dispute, Manoj, P.. The Hindu @businessline(23 December 2020). Retrieved 2021-07-13.
  26. ↑ Cairn India merges with Vedanta. The Economic Times(12 April 2017). Retrieved 2021-07-30.
  27. ↑ Cairn looking for arbitration money?, Sarkar, Shivaji. The Pioneer(24 July 2021). Retrieved 2021-07-24.
  28. ↑ Income tax department seizes Rs 440 crore dividend income of Cairn Energy. Hindustan Times(2018-04-15). Retrieved 2021-07-24.
  29. ↑ Cairn targets Indian assets in Paris: What is its dispute with Modi govt & why it's escalated, Nair, Remya. ThePrint(2021-07-10). Retrieved 2021-07-30.
  30. ↑ I-T dept sells shares of Cairn Energy to recover retrospective tax. The Economic Times(25 November 2018). Retrieved 2021-07-30.
  31. ↑ Cairn Energy wins over $1.2 billion from India in tax arbitration case. Reuters(2020-12-23). Retrieved 2021-07-13.
  32. ↑ Vodafone retro tax case: All you need to know. The Economic Times(25 December 2020). Retrieved 2021-07-13.
  33. ↑ India Challenges Vodafone Arbitration Ruling In Singapore. NDTV(24 December 2020). Retrieved 2021-07-30.
  34. ↑ Explained: Why is Cairn Energy suing Air India?, Vishwanath, Apurva. The Indian Express(2021-05-20). Retrieved 2021-07-09.
  35. ↑ Cairn Energy to file lawsuits in US, other nations to seize Indian PSU assets for recovery of $1.2 bn arbitration award. Firstpost(2021-03-28). Retrieved 2021-07-30.
  36. ↑ Cairn Energy, Devas Multimedia Filed Lawsuits to Seize Air India's Overseas Assets: Govt. Moneylife(23 July 2021). Retrieved 2021-07-24.
  37. ↑ US court sets timelines for Cairn India legal case. The Times of India(27 August 2021). Retrieved 2021-08-27.

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