NEW DELHI: A three-member tribunal of the Permanent Court of Arbitration in The Hague cited statements by the Prime Minister Narendra modi and other ministers who pledged not to use retrospective taxes to void a Rs 10,247 crore tax demand about British oil and gas company Cairn Energy Plc.
The court, in a 582-page ruling on December 21, ordered the return of the value of the shares that the Income Tax Department sold as well as the dividend it seized and the tax refunds it withheld to recover the tax claim that it was collected after the 2012 amendment to the Income Tax Law that gave authorities powers to collect taxes on previous agreements.
It declared that the 2006 reorganization of Cairn Energy’s business in India prior to listing on the local stock exchanges was not “illegal tax evasion” and ordered the tax authorities to withdraw the tax claim.
In the order, the court, which consisted of a member appointed by the Indian governmentsaid the Bharatiya Janata Party (BJP) The 2014 electoral manifesto “criticized the previous government for having unleashed ‘fiscal terrorism’ and ‘uncertainty’, which ‘negatively impact[ed] the investment climate ‘. ”
In his first budget speech in July 2014, the new Finance Minister, Arun jaitley, proposed that a ‘High Level Committee’ overseen by the CDBT be put in place to examine new cases that had arisen after the 2012 Amendments.
After saying that, “
