Tribunal judiciaire de Paris’ ruling based on Cairn Energy’s application will impact some 20 properties, valued at more than Euros 20 million, as part of a guarantee of the debt owed to the British company that exited India a few years ago.
“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,” said a source familiar with the proceedings.
The finance ministry on Tuesday said the government remains open to an amicable solution to resolve the dispute with Cairn within the country’s legal framework, while maintaining that it had not received any notice, order or communication, from any French Court regarding a freeze on state-owned properties.
“(The) Government is trying to ascertain the facts, and whenever such an order is received, appropriate legal remedies will be taken, in consultation with its Counsels, to protect the interests of India,” the ministry said in a statement.
On March 22, the government filed an application to set aside the December 2020 international arbitral award in The Hague Court of Appeal. “Government of India will vigorously defend its case in Set Aside proceedings at The Hague,” the government said.
The action in France is part of Cairn’s enforcement strategy to push the government to withdraw its appeal against an international tribunal’s award in the retrospective taxation case. The arbitration tribunal had held that the government had violated provisions of a tax treaty in seeking capital gains tax from the company listed in London.
Cairn has filed cases in several countries to pursue the unpaid international arbitration award of $1.7bn. The arbitration award has also been registered in other jurisdictions, including the US, the UK, Canada, Singapore, Mauritius, France and the Netherlands as the company focuses on high value assets.
It had filed cases in the Southern District of New York, seeking judicial confirmation that Air India can be classed as the alter ego of the Indian state and thereby jointly liable for the arbitral award.