InvestorQ : With Air India divestment on war footing, what would be the impact of Cairn threatening to attach the assets of Air India to recover government dues?
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With Air India divestment on war footing, what would be the impact of Cairn threatening to attach the assets of Air India to recover government dues?

Answer
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5 months ago
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The government has confirmed that lawsuits by Cairn Energy as well as the purported threat to attach assets of Air India against the dues of the Indian government, would not impact the proposed divestment of Air India. It may be recollected that after getting a favourable tribunal order in the Cairn India sale case, Cairn UK had sought to recover dues of $1.73 billion from the Indian government. This is currently under legal dispute.

The dues pertain to the shares of Vedanta that the Indian government had sold to recover its retrospective dues. Government had also withheld dividends and tax refunds due to Cairn Energy and had adjusted it against the partial recovery of retrospective taxation on Cairn for round tripping funds. While the government appears to be confident, it is not too clear what colour the entire tussle will eventually take.

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