New Delhi: In a setback to India, Britain’s Cairn Energy Plc has secured a French court order to seize some 20 government properties in Paris to recover a part of the USD 1.7 billion due from New Delhi following an arbitration panel overturning levy of retrospective taxes.
The centrally located properties mostly comprise flats, valued at more than EUR 20 million, used by the Indian government establishment in France, three people with direct knowledge of the matter said.
The French court, Tribunal judiciaire de Paris, on June 11 agreed to Cairn's application to freeze (through judicial mortgages) the residential real estate owned by the Government of India in central Paris, they said, adding that the legal formalities for this were completed on Wednesday evening.
While Cairn is unlikely to evict the Indian officials residing in those properties, the government cannot sell them after the court order.
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.
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.
Similar lawsuits are likely to be brought in other countries, primarily with high-value assets. The arbitration award has been registered in countries such as the US, the UK, Canada, Singapore, the Mauritius, France and the Netherlands.
Cairn has identified USD 70 billion of Indian assets overseas for the potential seizure to collect award, which now totals to USD 1.72 billion after including interest and penalty.
Last month, Cairn filed a petition with the courts in the Southern District of New York, seeking judicial confirmation that Air India, the national carrier, can be classed as the alter ego of the Indian state and thereby jointly liable for the arbitral award.
Air India has time till mid-July to file a plea contesting the Cairn lawsuit, sources said.
08/07/21 Tribune
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