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Finance Minister Arun Jaitley on Friday met officials to discuss on arbitration cases filed by companies against the government.
An inter-ministerial group of officials will decide next week on arbitration sought by the UK's Cairn Energy over a Rs 10,247 crore tax demand. Jaitley reviewed the arbitration notices served by foreign companies ahead of the inter-ministerial group meeting.
"The finance minister took stock of all the arbitration notices the government has been receiving," Revenue Secretary Shaktikanta Das told reporters here.
The inter-ministerial group, comprising officials from the ministries of finance, law and petroleum, would meet to decide on the government action over the arbitration notice issued by Cairn, he said. He added the group would give its view to Jaitley.
The finance ministry had initially rejected Cairn's plea for arbitration, saying taxation was not covered under the UK-India investment protection treaty. But the company sought treatment similar to British telecom major Vodafone.
The government has joined the arbitration initiated against a Rs 20,000 crore tax demand made on Vodafone and last month appointed Costa Rica-based lawyer Rodrigo Oreamuno to mediate on its behalf.
Using the India-UK investment protection treaty, Cairn has named former Bulgarian minister and lawyer Stanimir A Alexandrov as its arbitrator and asked the government appoint its own mediator on a three-member panel to go into the Rs 10,247 crore retrospective tax demand. The income tax department says Cairn allegedly made a capital gain of Rs 24,503.50 crore in 2006 when it transferred all its India assets to a new company, Cairn India, before listing on the stock exchanges.
Cairn Energy, which in 2011 sold a majority stake in its Indian unit to mining group Vedanta for $8.67 billion, still holds 9.8 per cent in Cairn India. The income tax department last January barred it from selling this stake.
