Cairn Energy sues Air India to enforce $1.2 bn arbitration award: Report

The move ratchets up pressure on India's government to pay the sum of $1.2 billion plus interest and costs that the British firm Cairn was awarded by an arbitration tribunal in December.
Cairn Energy has sued India's flagship carrier Air India to enforce a $1.2 billion arbitration award that it won in a tax dispute against India, according to a US District Court filing reviewed by Reuters.

The move ratchets up pressure on India's government to pay the sum of $1.2 billion plus interest and costs that the British firm Cairn was awarded by an arbitration tribunal in December.

The body ruled India breached an investment treaty with Britain and said New Delhi was liable to pay.

Cairn filed the lawsuit on Friday in the US District Court for the Southern District of New York, seeking to make Air India liable for the judgement that was awarded to Cairn. The lawsuit argued that the carrier as a state-owned company, is "legally indistinct from the state itself."

"The nominal distinction between India and Air India is illusory and serves only to aid India in improperly shielding its assets from creditors like (Cairn)," the filing said.

Air India and the Indian government did not immediately respond to requests seeking comment.

In February, Cairn filed a separate case in a US court to recognise and confirm the arbitration award, including payments due since 2014 and interest compounded semi-annually.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)


Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel