Cairn reassures on Indian tax rules compliance

LONDON Fri Jan 31, 2014 1:46pm IST

Cairn India employees work at a storage facility for crude oil at Mangala oil field at Barmer in Rajasthan August 29, 2009. REUTERS/Parth Sanyal/Files

Cairn India employees work at a storage facility for crude oil at Mangala oil field at Barmer in Rajasthan August 29, 2009.

Credit: Reuters/Parth Sanyal/Files

Related Topics

Stocks

   

LONDON (Reuters) - British oil explorer Cairn Energy (CNE.L) said it would defend its position in relation to inquiries by Indian Income Tax Department, reassuring on Friday that it had complied with all the country's fiscal rules.

The company said last week it had been contacted by India's tax authorities to discuss income tax assessments dating back about seven years, becoming the latest foreign firm to be embroiled in India's tax crackdown.

Cairn, which made its name finding huge oil fields in India that were then floated in a separate company as Cairn India (CAIL.NS) in 2006, said its advisers had checked its tax history and re-confirmed that the company has fully complied with the Indian tax legislation in force each year.

"The correspondence received from the Indian Income Tax Department indicates that this is in respect of amendments introduced in the 2012 Indian Finance Act which seek to tax prior year transactions under retrospective legislation," Cairn said in a statement.

"Cairn intends to take whatever steps are necessary to protect the company's interests and to defend its position," the company added.

While it discusses the issue with the Indian authorities, Cairn said it had been instructed not to sell any shares in Cairn India, in which it still holds a 10.3 percent stake.

The company, which is exploring for oil in Morocco and developing a large oil field off the coast of Britain, said that its activities elsewhere would continue as planned.

Shares in Cairn, which have lost 17 percent of their value since the company said it had been contacted by the Indian tax authorities last Friday, traded up 1.3 percent at 220 pence at 0808 GMT.

(Reporting by Sarah Young; editing by James Davey)

FILED UNDER:

Fast-tracking Projects

REUTERS SHOWCASE

Oil Prices

Oil Prices

Oil resumes slide after brief rebound on short-covering.  Full Article 

Space Programme

Space Programme

ISRO tests its heaviest space launch vehicle, eyes global market   Full Article 

Coal India Strike

Coal India Strike

Coal India workers threaten five-day strike, stokes output worries  Full Article 

Gold Discount

Gold Discount

Dealers offer gold discount for first time in five months  Full Article 

Lakhvi Granted Bail

Lakhvi Granted Bail

Pakistan court bails man accused of masterminding Mumbai attack  Full Article 

GST Bill

GST Bill

Cabinet clears bill for nationwide goods and services tax.  Full Article 

Aviation Sector

Aviation Sector

Breakingviews: SpiceJet rescue is no fix for India aviation woes.  Full Article 

Global Economy

Global Economy

Fed confident on U.S. growth, opens door wider to rate hike.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage