Britain’s Cairn Energy Plc said it has freezed properties owned by the Indian government in Paris to recover a part of its USD 1.7 billion arbitration award it won last year. The Scottish energy giant’s move comes after it secured a go-ahead from a French Court, in an attempt to force India to pay $1.7bn awarded by an international tribunal over a tax dispute.
French court on June 11 ordered Cairn Energy’s take-over of Indian government properties and the legal process was completed Wednesday evening, PTI reported. The company said it would effectively transfer the ownership of 20 properties valued at more than €20m, including in the 16th and 14th arrondissements, London’s Financial Times reported. The centrally located properties mostly comprise of flats, valued at more than EUR 20 million, were used by Indian government establishment in France, three people with direct knowledge of the matter said.
While Cairn is unlikely to evict the Indian officials residing in those properties, the government cannot sell them after the court order.
“This is the necessary preparatory step to taking ownership of the properties and ensures that the proceeds of any sales would be due to Cairn,” Cairn told BLoomberg. It added that its “strong preference remains an agreed, amicable settlement.”
A three-member international arbitration tribunal that consisted of one judge appointed by India, had in December last year unanimously overturned levy of taxes on Cairn retrospectively and ordered refund of shares sold, dividend confiscated and tax refunds withheld to recover such demand.
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With the Indian government refusing to honour the award, Cairn has moved in multiple overseas jurisdictions to enforce the award by seizing Indian assets.
Last month, Cairn brought a lawsuit in the US District Court for the Southern District of New York pleading that Air India is controlled by the Indian government so much that they are ”alter egos” and the airline should be held liable for the arbitration award.
