Cairn Energy Plc won a major relief on Wednesday as the Permanent Court of Arbitration at The Hague ruled that the Indian government’s retrospective tax demand against the global oil and gas major was “inconsistent” with the UK-India bilateral treaty.
The international tribunal also ruled that India’s demand of $1.2 billion in retrospective tax was “in breach of the guarantee of fair and equitable treatment”.
The judgment has asked the government to pay $1.2 billion (roughly Rs 8,800 crore) to Cairn Energy Plc — this, at a time when its revenues are strained due to the economic slowdown in the aftermath of the Covid-19 pandemic.
