Double blow for India. After Vodafone, Cairn Energy wins investment treaty arbitration against New Delhi in 5-year-old tax dispute

Cairn Energy Plc said Wednesday that it has won the arbitration against the Indian government over a tax dispute arising from demand of $1.2 billion from tax department on listing of Indian operations back in 2007.

The oil-major said that the tribunal had announced the award unanimously following which the Indian government will have to pay the UK-based company damages of $1.2 billion and interest.

“The tribunal established to rule on its claim against the Government of India has found in Cairn’s favour,” Cairn Energy Plc said in a statement in response to a query from ET.

“The tribunal ruled unanimously that India had breached its obligations to Cairn under the UK-India Bilateral Investment Treaty and has awarded to Cairn damages of US$1.2billion plus interest and costs, which now becomes payable,” the company added.