Govt asks banks to be on alert as Cairn move looms
The government has told state-run banks to report any notification on the seizure of assets, worried about the wider fallout of an international court’s order for India to pay $1.2 billion in damages to Cairn Energy.
The effort is to try and stop any asset seizure by companies invoking bilateral investment protection treaties (BITs) as it could lead to a “damaging precedent”, said a person privy to the development.
India asserts that damages cannot be sought under these treaties on tax matters, which are a sovereign function.
In February, the US District Court for Columbia issued a notice to the Indian government on a petition filed by Cairn Energy Plc and Cairn UK Holdings Ltd for enforcement of the arbitral award, court documents showed.
