The Indian government has asked a federal court in Washington to dismiss a lawsuit by British company Cairn Energy, which sought to enforce the Arbitration Tribunal’s order to pay $1.2 billion to the company. has gone. The Indian government has said that it has a sovereign exemption under US law. Cairn Energy had in May 2020 asked a US federal court to force it to comply with an arbitration tribunal’s order to give Air India $1.26 billion. The tribunal passed this order in favor of Cairn in December 2020.
Modi government filed ‘motion to dismiss’ petition
The Modi government filed a ‘Motion to Dismiss’ petition in the District of Columbia Court on 13 August 2020. It states that the dispute between Cairn and the Indian Tax Authority does not fall within its jurisdiction. Parliament passed an amendment law and repealed the provision of the law related to the imposition of retrospective tax from the date before 2012. Under this controversial law, the government was given the power to levy tax even in a 50-year-old case.
Amendment Bill has been passed by the Parliament of India
Under the controversial law, retrospective tax was applicable on change of ownership and capital gains of foreign companies operating in India. This 2012 law was used to levy a total tax of Rs 1.10 lakh crore on 17 companies, including Rs 10,247 crore on Cairn Energy. Recently, a bill brought in the Parliament of India to abolish this controversial law has been passed. Now the process of making rules to withdraw such tax demand is going on. Along with this, the Government of India is also ready to return the money without interest.