UK’s Cairn Plc will abide by the arbitration panel’s final decision on the long-drawn retrospective tax dispute with India, even if it goes against it, and India should adopt the same approach, said chief executive Simon Thomson.
Cairn faces a tax demand of Rs 29,000 crore, which it has contested, saying it cannot be taxed on a decade-old government-approved deal. The issue is expected to come up during Prime Minister Narendra Modi’s visit to the UK this month because many investors are concerned about retrospective taxation, and it involves a bilateral treaty between the two countries. Thomson said he would not speculate on the agenda of bilateral talks.
He said the trade treaty between India and the UK does not allow either party involved in arbitration to contest final decision of the panel. “All parties are obliged to abide by it. That’s the point of the international treaty between the UK and Indian governments,” Thomson told ETin an interview. “The treaty is designed to ensure there is fair treatment of companies. Read More