Centre Ready To Extend 'Vivad Se Vishwas' Scheme To Settle Tax Dispute With UK-Based Oil Major Cairn Energy: Report
The Central government is reportedly ready to extend the direct tax resolution scheme ‘Vivad Se Vishwas’ beyond 31 March to settle the international arbitration with Cairn Energy if the United Kingdom's oil major is willing to settle the dispute through the scheme.
In December last year, Netherlands' Hague-based Permanent Court of Arbitration (PCA) had directed the Indian government to pay damages worth $1.2 billion to Cairn Energy.
In a meeting with the Ministry of Finance officials last month, the oil and gas exploration company has been offered an immediate refund of $300 million if it chooses to settle the dispute through the ‘Vivad Se Vishwas’ scheme.
Under the scheme, Cairn’s principal tax demand will be cut down by around 50 per cent to Rs 5,100 crore. In addition to that, the interest and penalty will be waived off as the government will also return back the 1.8 per cent shares of the company that it had seized.
The government had already sold the energy major’s shares amounting to Rs 6,500 crore and hence the remaining sum will be refunded to the company, reports Business Standard.
“The only way to resolve the dispute immediately is through the Vivad Se Vishwas scheme. Cairn will get a refund in a matter of days. The arbitration process will take its own course and will go on for years," a government official was quoted in the report as saying.
The officer said that the government will be willing to extend the scheme post the end of this month in case Cairn goes on to adopt this course of action.
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