Govt to appeal against Cairn ruling – Times of India
Sticking to its accusation of Cairn having performed transactions through tax havens to “evade” paying taxes in India, the federal government will even “strongly contest” instances filed by the British vitality fir m in different worldwide courts, sources mentioned. Cairn has filed a case in a US district courtroom to implement the arbitration award, hoping that the transfer would put strain on the tax division. But tax authorities appeared unmoved.
The statements come a day after Cairn CEO Simon Thomson met finance secretary Ajay Bhushan Pandey and Central Board of Direct Taxes chairman P C Mody to press for an early settlement, following the tribunal’s verdict of their favour.
Although the federal government has time till the third week of March to file an appeal, it appears to have made up its thoughts on the difficulty. But it’s but to touch upon it formally.
“The government welcomes Cairn’s move to reach out for a resolution. However, any dispute resolution to be sought by Cairn will have to be within already existing laws,” a authorities supply mentioned. This signifies that the federal government is unwilling to settle for the tribunal’s order, which held India responsible of not honouring its dedication beneath the bilateral funding treaty.
The authorities, nevertheless, believes {that a} tribunal’s ruling can’t override the legislature’s energy to resolve on tax issues — an argument it had made whereas interesting against the same order within the Vodafone case, which had triggered the retrospective modification.
But in contrast to the Vodafone case, the place no tax has been deposited with the federal government, tax authorities have recovered a component of the claims by promoting shares in India that had been connected.
There have been options that Cairn might look to settle the case beneath the ‘Vivaad Se Vishwaas’ scheme, however it will have to cough up taxes, which it has argued is unfair. In reality, the corporate had managed to get British Prime Minister and different ministers to take up the difficulty with their Indian counterparts.
